BF Investment Board Does Not Approve Delisting Plan Over Share Sale By A Promoter

Its audit firm found that one member of the promoter group sold 400 equity shares on June 30, 2022.

<div class="paragraphs"><p>The Bombay Stock Exchange building in Mumbai. (Source: Reuters)</p></div>
The Bombay Stock Exchange building in Mumbai. (Source: Reuters)

Shares of BF Investment Ltd. tumbled after the board of did not approve proposal to take the investment arm of the $2.5-billion Kaylani Group citing violation of regulations by a member of the promoter group.

The board of the company in its Jan. 4 meeting rejected the proposal for voluntary delisting of shares, according to its filing. That came after audit firm SVD & Associates, during its due diligence, found that one member of the promoter and promoter group sold 400 equity shares on June 30, 2022, before the company's first public announcement.

The company had informed exchanges on Dec. 30 that the board will meet on Jan. 4 to consider delisting of shares.

According to Regulation 4(2) of the Delisting Regulations, no acquirer, including promoters, who has sold any equity shares of the company during six months prior to the date of the initial public announcement can propose the delisting of equity shares.

The promoters had expressed their intention, either individually or collectively, to acquire all equity shares that are held by public shareholders.

DGM Realities Pvt., along with Ajinkya Investment and Trading Co. and Sundaram Trading and Investment Pvt., all members of the promoter and promoter group—through Axis Capital—had announced to acquire equity shares from the public and voluntarily delist BF Investment from the stock exchanges.

As of Sept. 30, promoters held 74.13%, individual shareholders owned 13.07%, followed by bodies corporate (4.79%), LLP (4.39%), and Krutadnya Management and Trading Services LLP (4.16%).

The company’s equity shares are listed on the BSE Ltd. and the National Stock Exchange of India Ltd.

Shares of BF Investment had surged about 75% in the previous eight sessions. On Thursday, the stock tumbled 10%, the biggest fall since Feb. 24, 2022, to hit a lower circuit compared with a 0.42% decline in Nifty 50.