Friday, November 23, 2001
MUMBAI. 22 NOVEMBER
The Securities and Exchange Board of India has ruled that
the new owner of Hughes Elecronics is not required to make
an open offer for its Indian subsidiary Hughes Software System
according to a senior Sebi official.
The Hughes Electronics stock has jumped about 60 per cent
since late October on hopes of an open offer. In early Thursday
morning trading shares were down 11.8 per cent at Rs 266.50.
"We were satisfied with the case presented by Hughes
Software and convinced that there was no change in management,"
an executive director of Sebi saidon condition of anonymity.
In late October, General Motors agreed to sell its satellite
television unit Hughes Electronics to EchoStar Communications
for $25.8 billion in cash and stock.
Hughes Electronics owns 56.1 per cent of Hughes Software
Systems, a leading Indian communications equipment and software
maker.
Under Indian takeover rules, any company which acquires control
of a publicly listed domestic company, directly or indirectly,
has to make an open offer to buy a further 20 per cent from
the remaining shareholders.
In a communique to the stock exchanges in late October Hughes
Software said there was no change in control of its management
following the purchase of its US parent.
It also said it was unlikely an open offer would be made.
"Since there is no agreement or intention to acquire
Indian shares of Hughes Software Systems and since the amalgamation
is not an indirect acquisition of Hughes and since there is
no change in control or agreement to change control, no
minimum public offer is likely to be made," Hughes said
in a statement sent to the Bombay Stock Exchange on October
29.
But it also said Hughes Software would convene an extraordinary
general meeting to discuss the matter.
Afterwards Sebi asked Hughes to provide details so the market
regulator could decide whether an open offer was required
or not.
Last updated : February 2, 2004
|
