GAZETTE OF INDIA
EXTRA-ORDINARY
PART II - SECTION 3- SUB-SECTION (ii)
PUBLISHED BY AUTHORITY
SECURITIES AND EXCHANGE BOARD OF INDIA
NOTIFICATION
Mumbai, the 15th September, 2005
SECURITIES AND EXCHANGE BOARD OF INDIA, MUMBAI
ORDER UNDER SECTION 4B (6) READ WITH SECTION 4B (7) OF THE SECURITIES CONTRACTS (REGULATION) ACT, 1956 IN THE MATTER OF THE LUDHIANA STOCK EXCHANGE ASSOCIATION LIMITED (DEMUTUALISATION) SCHEME, 2005.
S. O. 1317 (E). 1.0 The Ludhiana Stock Exchange Association Limited (hereinafter referred to as the ‘LSE’), registered under the Companies Act, 1956 as a company limited by shares, is a recognised stock exchange having its Registered Office at Feroze Gandhi Market, Ludhiana. It is required to be demutualised in accordance with the provisions of the Securities Contracts (Regulation) Act, 1956 (hereinafter referred to as the ‘SCRA’).
2.0 The LSE, vide its letter dated January 17, 2005, submitted a Scheme for its demutualisation for approval to the Securities and Exchange Board of India (hereinafter referred to as the ‘SEBI’) in terms of sub-section (1) of section 4B of the SCRA. SEBI, vide letter dated May 25, 2005, advised LSE to submit a revised Scheme, after taking into account the provisions of the BSE (Corporatisation and Demutualisation) Scheme, 2005, which may be relevant and applicable to LSE.
3.0 Accordingly, LSE, vide its letter dated June 21, 2005, submitted a revised Scheme for its demutualisation, after taking into account the provisions of the BSE (Corporatisation and Demutualisation) Scheme. SEBI made enquiries and obtained further information from LSE through discussions with it. The Scheme was discussed in a meeting with the LSE on July 8, 2005. Based on the discussions during the said meeting, LSE desired to submit a further revised Scheme. Accordingly, LSE, vide its letter dated August 30, 2005, submitted a further revised Scheme for its demutualisation (hereinafter referred to as the ‘Scheme’), for approval to SEBI.
4.0 The Scheme, inter alia, provides for the segregation of ownership and management from the trading rights of the members, restriction on voting rights of shareholders who are also trading members, composition of the Governing Board, etc. in accordance with the provisions of Section 4B (6) of the SCRA, utilisation of assets and reserves and other matters required for the purpose of and in connection with the demutualisation of LSE.
5.0 SEBI, having considered the Scheme and on being satisfied that it would be in the interest of the trade and also in the public interest, hereby approves the Scheme with minor modifications. The approved Scheme is enclosed as Annexure - A.
6.0 LSE shall ensure compliance with the Scheme within the time as specified in the Scheme and shall not do anything contrary to the provisions of Scheme and submit compliance report to SEBI in the manner as may be specified by SEBI.
7.0 SEBI reserves the right to amend, alter or modify the Scheme in the interest of the trade and the public interest and in furtherance of the objectives of the demutualisation of the stock exchange.
8.0 The Scheme shall come into effect on the day of its publication in the Official Gazette.
F. No. SEBI/MRD/ 49403 /2005
M. DAMODARAN
CHAIRMAN
SECURITIES AND EXCHANGE BOARD OF INDIA
Encl: Annexure - A