Gazette published on stakes by sponsor-directors

FE Report An official gazette notification on the minimum stakes by the sponsor-directors of the listed companies, enforced recently by the securities regulator to ensure more accountability, was published Wednesday, officials said. The published gazette notification comes after the Securities and Exchange Commission (SEC) made holding of at least 30 per cent stakes of a listed company by its sponsors-directors mandatory on November 22 this year to contain their aggressive sale pressure without caring for the market situation. As per the SEC notification, individually each of the directors, other than independent director(s), of any listed company must hold minimum shares amounting to two per cent of the company's total paid-up capital, and in total the directors have to own at least 30 per cent. And the sponsor-directors holding less than 30 per cent of shares of a company will have to acquire the rest portion of shares within six months of publishing a gazette on the notification. Individually, the sponsor-directors who own less than two per cent stakes will have also will have to acquire their remaining stakes within the same time frame. An SEC official said the mandatory provision of holding minimum stakes by sponsor-directors has turned into a law after a gazette notification has been published on Wednesday.