SEBI slaps Rs. 25cr fine on Ambani Brothers


SEBI on Wednesday imposed a total fine of Rs 25 crore on Mukesh Ambani, Anil Ambani, other persons, and entities for non-compliance with takeover norms in a Reliance Industries case dating back to 2000. Others fined by the watchdog SEBI include Nita Ambani and Tina Ambani.

RIL’s promoters and Persons Acting in Concert (PAC) failed to reveal the allegation of more than 5 percent stake in the company way back in 2000, SEBI said in its 85-page order. In 2005, Mukesh and Anil had split the business empire built by their father Dhirubhai Ambani.

Following the order, 6.83% of shareholdings acquired from RIL promoters and PACs connected with optional use of warrants with secured debenture under non-convertible securities exceeded the 5% ceiling prescribed by the takeover regulation. Therefore, on 7 January 2000, it was the obligation to make a public notification regarding the purchase of the shares. The order indicated the date when RIL shares were allocated to the PACs in January 1994, when warrants were exercised.

However, SEBI has found that no public notification for the acquisition of the shares has been made by promoters and PACs. Since no public notification was made for the acquisition of shares by the developers and PACs, the taking over regulation provisions is allegedly being infringed.

The order was not issuing a ‘public announcement,’ which denied the shareholders the statutory rights/occasion of exiting from the company’ by different persons and entities. The regulator imposed a penalty on individuals and entities concerned of Rs 25 crore to be paid jointly and severally.

Mukesh Ambani will appeal to SEBI for allegations of irregularities in the company’s two-decade-old stock issue, the firm said on Thursday.  In 1994, RIL issued convertible bonds and in 2000 allocated equity shares against bonds. Reliance Industries Ltd. Dhirubhai Ambani was the director of the undivided enterprise. The company had issued a showcase notification (more than 11 years after acquiring the shares), the company told the stock exchange file on Thursday, ‘in February 2011 to promote and promote a group (as in 2000) that allegedly breached’ takeover regulations.

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