Skip to content

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

Under Section 12A(f) of the SEBI Act, 1992, the prohibition on acquiring control or securities above a prescribed percentage applies to which companies?

Section 12A(f) applies to companies whose securities are listed or proposed to be listed on a recognised stock exchange. It is not limited to already listed companies, nor to private or public sector companies as such. The contravention must be of regulations made under the Act.

  1. ACompanies whose securities are listed or proposed to be listed on a recognised stock exchangeCorrect
  2. BOnly companies whose securities are already listed, not those proposed to be listed
  3. CAll private limited companies with more than one shareholder
  4. DOnly public sector undertakings whose shares are traded on a stock exchange

Explanation

Section 12A(f) refers to a company whose securities are listed or proposed to be listed on a recognised stock exchange. It therefore covers both existing listed companies and those proposing to list. Restricting it to already listed companies omits the 'proposed to be listed' limb, and the other options have no basis in the text.

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