Disclosure for rights issues made simpler

Market regulator SEBI on Thursday decided to simplify disclosure norms for rights issues to make them attractive for companies, include anchor investors in IPOs and remove the entry load in MF schemes.

At its board meeting, the Securities and Exchange Board of India decided to simplify the disclosure norms for rights issues, Chairman C B Bhave said.

He also said the board has approved the concept of anchor investors which are long-term strategic investors.

"Anchor investor will be included in Qualified Institutional Buyers (category). They can get 30 per cent of quota reserved for QIBs," Bhave said.

As 50 per cent of IPO is reserved for QIBs, the new provision would mean that anchor investors could be given up to 15 per cent of the issue.

Bhave also said no person related to promoters, promoters group or book running lead managers could be anchor investors.

He said issuers of IPOs will have to carry bidding process for anchor investors one day prior to opening of issue price.

The SEBI board also decided to do away with entry load for mutual fund schemes.