Reliance Industries' programme to buy back its shares, which was decided at the December 27 board meeting in the face of opposition from vice-chairman Anil Ambani, has received the go-ahead from Securities and Exchange Board of India, subject to certain disclosures to shareholders.
"We have directed Reliance Industries to make certain disclosures regarding their buyback programme," G N Bajpai, Chairman of Sebi, told PTI in Mumbai on Monday.
The Reliance 'ownership issue'
Bajpai's comments come even as RIL disclosed in newspaper advertisements that four companies -- Reliance Polyolefins Pvt Ltd, Reliance Aromatics and Petrochemcials Pvt Ltd, Reliance Energy and Project Development Pvt Ltd and Reliance Chemicals Pvt Ltd -- held 4.7 per cent equity share in RIL, headed by Mukesh, the elder of the Ambani brothers, and were listed as Persons Acting in Concert.
"It is, therefore, baseless to allege that there has been any intention of the management of RIL to divert the benefits of these assets to the promoters," RIL said in its advertisement.
The advertisement, aimed at giving a correct picture in the face of a spate of news-reports, on the day the buyback programme kicks off, said, "The economic benefits of RIL shares held by these four companies have always been for the benefit of RIL's shareholders, and remain so."
Meanwhile Sebi officials clarified that these companies disclosed as PAC would not be participating in the buyback programme.
Sebi officials said the market regulator has also asked Reliance to disclose the position of Nimesh Kampani, a trustee in the Petroleum Trust, holding 7.5 per cent equity capital of
RIL besides heading JM Morgan Stanley, the manager of the buyback programme.
They, however, clarified that prima facie there was nothing in the regulations prohibiting JM Morgan from handling the buyback programme.
Accordingly, RIL said in its advertisement that holding of the trust has been shown a part of "promoters" and that another group company Reliance Industrial Investment and
Holding Ltd, a wholly-owned subsidiary of RIL, is a sole beneficiary of the trust.
The advertisement said, "In terms of the scheme of amalgamation of Reliance Petroleum Ltd with RIL, shares of RIL were issued in the name of the trustees of the trust against the shareholding of RIIHL."
RIL also strongly refuted the "totally baseless insinuation that some shares, which were acquired by a few companies on merger of RIL and RPL and were held by them to ensure that their economic benefits flow to the shareholders have been appropriated by the Ambani family".
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