India reduces minimum public share float, paving way for NSE, Jio listings
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The regulator last year proposed to halve the minimum amount of shares large companies had to offer in their IPOs, allowing those valued at above Rs 5 lakh crore ($57 billion) after listing to sell just 2.5% of their paid-up capital. This has now been formally notified by the government, bringing it into force.The changes were part of rules released late on Friday.
Details of the changes are below:
* At least 2.5% of each class of equity shares can beoffered to the public.
* A mandatory glide path has been put in place to reach a25% public shareholding. Companies with a public shareholding ofless than 15% at listing will have 5 years to reach 15% and 10years to reach 25%.
* If the public float is more than 15% at listing, thecompany will have 5 years to reach 25%.
* For companies with a market capitalisation of between Rs 1 lakh crore and Rs 5 lakh crore, the minimum public float will be set at 2.75%. * For companies with a market capitalisation of between Rs 50,000 crore and Rs 1 lakh crore, the minimum public float is set at 8%.
* Other provisions include a condition that if a company with a class of equity shares with superior voting rights is listing ordinary shares, it must also mandatorily list theshares having superior voting rights.
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