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CS Professional · Strategic Management and Corporate Finance · Infrastructure Investment Trusts

A public InvIT is planning an initial offer of units. Which statement reflects the requirement for the InvIT's unitholding after the offer?

A public InvIT must ensure at least 25% of its post-offer outstanding units are held by the public, while the sponsor group's holding is subject to minimum holding and lock-in requirements. Permitting full sponsor holding or no public minimum is incorrect.

  1. ASponsor and sponsor group together may hold 100% of the units permanently
  2. BPublic holding must be at least 25% of the total outstanding units after the initial offer, with the sponsor group's holding subject to minimum lock-in normsCorrect
  3. CPublic holding must be exactly 51% at all times
  4. DThere is no minimum public holding for a public InvIT

Explanation

For a public InvIT, SEBI's regulations require the post-offer public holding to be at least 25% of outstanding units, and the sponsor group must hold a minimum percentage subject to lock-in. A 100% sponsor holding, a fixed 51% public requirement or no minimum are all inconsistent with this.

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