The Securities and Exchange Board of India (SEBI) has granted an exemption from the mandatory open offer requirement for the proposed promoter restructuring involving Muthoot Microfin, clearing the way for an internal family succession plan.
The market regulator approved the indirect acquisition of Muthoot Microfin by six Muthoot family trusts through a restructuring of the promoter shareholding. Under the approved structure, six family trusts will acquire a 63.35% stake in Muthoot Fincorp, the promoter entity that owns a 50.21% stake in listed Muthoot Microfin.
SEBI said the restructuring would not result in any change in control of Muthoot Microfin, making an open offer to public shareholders unnecessary. The regulator also noted that the promoter shareholding and public shareholding in Muthoot Microfin will remain unchanged following the transaction.
According to SEBI, the revised restructuring has been designed to align the promoter holding structure with the proposed initial public offering (IPO) of Muthoot Fincorp. The regulator said the transaction is an internal family succession exercise that will be carried out through gift transfers among members of the promoter family.
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SEBI further observed that the ultimate beneficial ownership of the business will continue to remain with the existing promoter family, ensuring continuity in ownership and management.
The regulator also concluded that the interests of public shareholders in Muthoot Microfin would remain unaffected, as there would be no change in control, promoter ownership or the company's public shareholding pattern.
The exemption removes a key regulatory hurdle for the promoter restructuring ahead of Muthoot Fincorp's proposed IPO while preserving the existing ownership and governance framework of Muthoot Microfin.
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