No Open Offer Required for Spice Healthcare, Says Sebi

Sebi Eases Burden on Spice Healthcare with Open Offer Exemption

Market regulator Sebi has excused Spice Healthcare Pvt Ltd from making an open offer to SpiceJet shareholders regarding purchasing further airline shares. Spice Healthcare, an entity within the promoter group, would obtain 13,14,08,514 extra equity shares in the airline upon the conversion of warrants given to it.

Regarding this, SpiceJet has applied to Sebi for an exemption to make an open offer to the airline’s stockholders. Spice Healthcare said in a filing to the BSE that it had been excused from making the open offer by the Securities and Exchange Board of India (Sebi) through an order, subject to certain restrictions.

Spice Healthcare will own a 13.74 percent share in the airline upon the conversion of the warrants, which will require an open sale following Sebi regulations. The watchdog has approved the exemption, but only if the shares that the entity purchases upon exercising its warrants would remain locked in for an extra six months, for a total of twenty-four months. For these kinds of conversions, the lock-in period is typically 18 months.

Spice Healthcare’s increased voting rights resulting from converting warrants into shares will be blocked for a predetermined time following the Sebi order, which the airline has submitted to the BSE. The financially troubled SpiceJet is soliciting money to strengthen its position and pay its debts.