India market regulator proposes bondholder nod for related party transactions

The regulator has asked for comments till Feb. 22

Jayshree P, Reuters News

February 8, 2023

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MUMBAI - India's market regulator on Wednesday proposed that bondholders should have the right to object to related party transactions proposed by companies, which have listed high value debt securities.

The regulator has asked for comments till Feb. 22.

The Securities and Exchange Board of India (SEBI) said the proposal will be applicable in cases where more than 90% of the company's shareholding is with entities defined as related parties. If more than 75% of bondholders object to a transaction, then the board will have to withdraw it.

The norms will be applicable to only listed non-convertible debt securities, according to SEBI.

(Reporting by Jayshree P. Upadhyay)

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