Skip to content

CS Executive · Capital Market and Securities Laws · Acquisition of Shares and Takeovers - Concepts

Meera Holdings Ltd acquires shares of a company listed on a recognised stock exchange and crosses the permitted percentage without following the SEBI regulations made under the SEBI Act. Which Section 12A clause is most directly breached?

Clause (f) of Section 12A is breached. It specifically prohibits acquiring securities beyond the percentage of equity share capital, or acquiring control, of a listed company in contravention of the regulations. The other clauses deal with fraud, manipulation or insider trading, which are not the facts here.

  1. AClause (d), engaging in insider trading
  2. BClause (f), acquiring securities beyond the percentage of equity share capital in contravention of the regulationsCorrect
  3. CClause (a), using a manipulative device in connection with an issue only
  4. DClause (e), communicating non-public information

Explanation

The facts concern exceeding the permitted shareholding percentage in a listed company contrary to regulations. That is the subject matter of clause (f). Clauses (d) and (e) concern insider trading and unpublished information, and clause (a) concerns manipulative devices, none of which is alleged here.

Did you get it right without looking?

One question tells you little. A timed set on Acquisition of Shares and Takeovers - Concepts shows your real accuracy, how long you take and where you lose marks.

Practise Acquisition of Shares and Takeovers - ConceptsFree diagnostic mock

More Acquisition of Shares and Takeovers - Concepts questions