Orchid Pharma promoters’ shares frozen for non-compliance with SEBI norms

Orchid Pharma The exchanges said on Wednesday that the exchanges have begun freezing shares of the promoters for the company’s failure to comply with market regulator SEBI’s minimum public shareholding standards within the specified time period.

Under SEBI’s standards, listed companies are required to have a minimum public shareholding (MPS) of 25 percent and exchanges can take action against companies, including freezing promoter shares, for non-compliance.

In a regulatory filing, the company said its directors have been told they will not take any new position as a director at any other listed entity.

“The directors were informed at the board meeting held on May 10, 2023 that they will not take any new position as a director in any other listed entity and that the freezing procedure has been initiated by the exchanges against the promoters and promoters,” Orchid Pharma said.

The company stated that in its endeavor to maintain a minimum public shareholding of 25 per cent of the total shareholding, Dhanuka Laboratories has made it an offer to sell representing 8.04 per cent of the shareholding in 2021.

She added that after the sale offer, the promoter owned 89.96 percent of the shares, raising the public shareholding percentage to 10.04 percent within 18 months from the date of acquisition of the company.

In addition to the above, the company has also initiated the process of raising capital through a qualified institutional placement in time to achieve the minimum public shareholding by the date of March 30, 2023, Orchid Pharma said.

She added that in the past six months, the company has appointed lead agencies and taken appropriate steps to ensure that they meet MPS requirements as soon as possible.

“However, due to adverse market conditions, our company was unable to launch QIP,” said Orchid Pharma.

It added that the company also sought a one-year relaxation from SEBI to meet minimum public shareholding requirements.

She added that the required fees have been deposited.

The company was acquired by Dhanuka Group in 2018.

Shares of the company closed down 2.4 percent at ₹437.35 per share on BSE.