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Promoters may ‘Give Way’ to controlling shareholders

Market regulator, SEBI, wants to introduce the concept of controlling shareholders.

By Reena Zachariah, ET Bureau |Updated: November 19, 2019, 03.11PM IST
MUMBAI: Listed Indian companies may soon see a radical shift in the way ‘promoters’ are classified. The Securities and Exchange Board of India (Sebi) is planning to overhaul the concept of promoters that could lead to the introduction of ‘controlling shareholders’ — a structure new to India but prevalent in various developed markets, said three people familiar with the matter.
cited above. “If you look at the past few years, a lot more professionally managed private equity run firms are floating IPOs (initial public offerings),” the person said. Sebi thinks the economy and business drivers are changing and the shareholding structure need to be altered. The proposed changes may help startups where promoters may not be in control.

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