Sebi bans Omaxe, 5 others for violating minimum public shareholding norms
The Securities and Exchange Board of India (Sebi) has taken decisive action against Omaxe and five associated entities for breaching public shareholding regulations. Omaxe and its promoters were accused of creating a deceptive public shareholding framework, involving funds used to repurchase its shares via various means. As a result, Omaxe faces a three-month market access ban, while the others…
India's market regulator Sebi has banned real estate company Omaxe and five associated entities from participating in the securities market for up to one year, along with imposing a Rs 1.92 crore fine. The regulator accused Omaxe and its promoters, Rohtas Goel and Jai Bhagwan Goel, as well as their group companies Dream Home Developers and Guild Builders, of creating a fake public shareholding structure to meet minimum public shareholding norms.
Sebi found that Omaxe failed to achieve the required 25% minimum public shareholding through independent public shareholders, as the company's shares were acquired by certain entities using funds from Omaxe and its group entities. These entities were subsequently listed as public shareholders, misleading regulators about the company's compliance with the norms.
The regulator noted that the funds were routed through multiple entities, including DVM Realtors, Garv Buildtech, and Jeet Builders, to acquire Omaxe shares, creating the appearance of independent public shareholding. Sebi stated that the scheme constituted a fraudulent and deceptive practice, violating provisions of the Sebi Act and related regulations.
Omaxe and the other entities have been prohibited from accessing the securities market and dealing in securities for one year, along with facing individual fines totaling Rs 1.92 crore.
Written by urgent.news from The Economic Times - Top News's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
