SEBI has allowed the CT Doshi Family Trust to acquire a 44.88% stake in Waaree Energies without a mandatory open offer. This move follows an internal succession plan by promoter Chimanlal Tribhuvandas Doshi. The regulator confirmed this transfer involves no change in company control and will not impact existing public shareholding.
What Happened
The Securities and Exchange Board of India (SEBI) has granted a regulatory exemption to the CT Doshi Family Trust regarding its stake acquisition in Waaree Energies Limited. Under standard takeover regulations, acquiring a stake exceeding 25% usually triggers a mandatory open offer, where the buyer must offer to purchase shares from public shareholders. However, the regulator has waived this requirement, allowing the trust to proceed with an internal share transfer from promoter Chimanlal Tribhuvandas Doshi.
Understanding The Succession Plan
The transfer involves a direct 44.88% stake acquisition by the family trust, along with an indirect 18.34% interest held through Waaree Sustainable Finance Pvt. Ltd. SEBI approved this transfer after determining that the transaction is purely for family succession and governance purposes. The regulator emphasized that the total promoter group holding of 64.22% will remain unchanged after the transfer, and there will be no shift in the management or operational control of the company. The beneficiaries of the trust are exclusively family members of the settlor.
Why SEBI Allowed The Exemption
SEBI’s rules typically require a promoter to have been publicly disclosed as such for at least three years before qualifying for this type of exemption. Because Waaree Energies listed on the stock exchange in October 2024, it could not meet the strict three-year timeline. However, the regulator’s Takeover Panel recommended the exemption based on the fact that the promoter had been identified in the company's draft filings dating back to 2021. SEBI accepted this rationale, noting that the spirit of the disclosure requirement had been fulfilled. The regulator also took into account the age of the 91-year-old promoter, Chimanlal Doshi, in reaching its decision.
What This Means For Investors
For shareholders, this decision provides clarity on the promoter group's long-term succession planning. Since the exemption is specific to this internal transfer and does not change the management structure or the total number of shares held by the promoters, it is unlikely to have a direct impact on the day-to-day operations of the company. The exemption remains valid for one year, during which the trust is required to complete the acquisition process and submit a post-acquisition report to the regulator. Investors can view this as a neutral governance update that stabilizes the ownership structure within the promoter family.