POST-ISSUE ACTIVITIES
- 1. POST ISSUE ACTIVITIES OF Merchant Banker By, Koshy Vaidyan T.K 1241036
- 2. Merchant Banking -Definition • SEBI (Merchant Bankers Rules) 1992, “A MB has been defined as any person who is engaged in the business of issue management either by making arrangements regarding selling, buying or subscribing to securities or acting as manager, consultant, adviser or rendering corporate advisory services in relation to such issue management.”
- 3. What is issues management? Issues management is the management process whose goal is to preserve markets, reduce risks, create opportunities and manage corporate reputation as an organizational asset for the benefit of both the organization and its primary stakeholders. Two Main Activities in Issue Management: • Pre- Issue Activities. • Post- Issue Activities.
- 4. POST-ISSUE activities • Post issue monitoring reports The post issue lead merchant banker shall ensure the submission of the post issue monitoring reports Due diligence certificate to be submitted with the final post issue monitoring report. The post issue lead merchant banker shall file a due diligence certificate in the format specified along with the final post issue monitoring report
- 5. • Redressal of the investor grievances The post-issue lead merchant banker shall actively associate himself with post-issue activities namely allotment, refund and despatch and shall regularly monitor redressal of investor. Coordination with the intermediaries The post-issue lead merchant banker shall maintain close coordination with the Registrars to the Issue. Any act of omission or commission on the part of intermediaries shall be reported to the Board
- 6. Underwriters • The lead merchant banker shall satisfy himself that the issue is fully subscribed before announcing closure of the issue • The lead merchant banker shall ensure that the underwriters honour their commitment within 60 days from the date of closure of the issue. • The lead merchant banker shall furnish information in respect of underwriters who failed to meet their underwriting devolvement's
- 7. Bank to issue • The post-issue lead merchant banker shall ensure that moneys received pursuant to the issue are kept in a separate bank (i.e Bankers to issue )as per the provisions of section 73(3) of the companies act, 1956. Post issue advertisements • Post- issue lead merchant banker shall ensure that in all issues, advertisement giving details relating to oversubscription, basis on allotment, number, value and percentage of application received etc. is released within 10 days.
- 8. Basis of allotment In a public issue of securities , the managing director along with the lead merchant banker and the registrar to an issue, shall ensure that basis of allotments is finalised in a fair and proper manner Proportionate-allotment Procedure an allotment shall be made on a proportionate basis within the specified categories . The proportionate allotments of securities in an issue, that is oversubscribed shall be subject to reservation for the retail individual investors as described in the following:
- 9. 1. A minimum 50% of the net offer of securities to the public shall initially be made available for the allotment to retail individual investors as the case may be. 2. The balance net offer of securities to the public shall be made available for allotment to: a) individual applicants other than retail individual investors b) other investors including corporate bodies/ institutions , irrespective of the number of shares, debentures and so on , applied for .
- 10. 3. The unsubscribed portion of the net offer to any one of the categories may be made available for allotment to applicants in the other category, if so required Advertisement An announcement in the newspaper has to be made regarding the basic of allotment, the number of applications received and the date of despatch of share certificate and refund orders, etc.
- 11. Thank you