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April 28, 2001
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Money > Business Headlines > Report April 28, 2001 |
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Sebi to probe takeover breach in Nedungadi caseGeorge Smith Alexander & Rakesh P Sharma The Securities and Exchange Board of India will start investigations into the stock brokers' holdings in Nedungadi Bank. A group of brokers led by Rajendra Bhatia and Shrikant Mantri, along with their associates, together hold around 21 per cent of the bank's equity, while the bank estimates the total holdings of the brokers at 41 per cent. Sebi is looking into whether the cartel has violated the takeover code in not informing the exchanges of its holding in the bank. Sources said while the two sets of brokers held between 10 per cent and 11 per cent each, they were allegedly acting in concert. In 1998, Sebi had barred Rajendra Banthia's firm Harvest Deal from undertaking broking for its alleged involvement in price rigging of scrips of Nedungadi Bank, BPL, Sterlite and Videocon. Banthia was forced to quit his position as vice-president on the Bombay Stock Exchange, following the Sebi indictment. Subsequently, the Sebi order was stayed by the Bombay High Court. The court, in its order, allowed the firm to undertake business, except in the four above-mentioned scrips. The bank is said to have alerted the Reserve Bank of India that Shrikant Mantri holds around 10 per cent in his own name and through Shanti Devi Mantri, Vimla Mantri, Sushil Kumar Mantri, Ram Kishore Boob, Vijaykumar Soni and Megha Securities. Rajendra Bhantia, along with Surendra Bhantia and Saroj Bhantia is said to control around 11 per cent of the bank's equity. Nedungadi Bank's director CV Nair said that bank had told the Reserve Bank of India on the shareholding of Banthia and Mantri and also had sought its permission when broker MG Damani was elected on the bank board with the active support of the Banthia group. "These brokers have entered through the front door and we are not able to do anything about it," said Nair. Neither of the two brokers has informed the exchanges of their holdings crossing the trigger point of 5 per cent, as required by the Sebi takeover code. The Bombay Stock Exchange has also started its investigations into the matter. Powered by YOU MAY ALSO WANT TO READ:
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