Sebi simplifies listing norms for corporate debt

To provide vibrancy to lacklustre primary market for corporate bonds,
Sebi removed the requirement of filing of draft offer documents with
the market regulator for such issues but made it mandatory for
companies to get credit rating.


However, a draft offer document has to be filed with the stock
exchange through the lead merchant banker, according to Regulations
for Issue and Listing of Debt Securities notified on Thursday.



The lead merchant banker would have to ensure that all comments
received on the draft offer document are suitably addressed prior to
the filing of the offer document with Registrar of Companies.


For any public issue of corporate debts, credit rating has to be
obtained from at least one credit rating agency with the Sebi's
approval and is disclosed in the offer document, the Regulation said.


In case where ratings are obtained from more than one agency, all such
ratings, including the unaccepted ones, would have to be disclosed in
the offer documents.



Every rating would be periodically reviewed by the registered credit
rating agency and any revision would have to be disclosed to the stock
exchange.


The issuer can also list its debt securities on a private placement
basis, provided they have been credit rated and meet other
regulations.


The issuer would have to redeem the debt securities in terms of the
offer documents, the Regulation said.


However if the issuer wants to roll-over debt securities issued by it,
it would have to pass a special resolution of holders of such
securities and give a 21 day notice for the roll-over to them, the
Regulation added.


Special resolution means consent of not less than 75 percent of the
holders by value of debt securities.