Sebi Checks Possibility to Allow SPACs in India

Securities and Exchange Board of India (Sebi) is presently checking out the possibility of permitting special purpose acquisition companies (SPACs) to function in the country, say Sebi chairman Ajay Tyagi.

Addressing the annual Capital Market Conference organised by industry body FICCI, Ajay states that the market regulator's Primary Market Committee is evaluating the possibility of allowing SPACs to work in India.

However, existing Sebi rules don't permit listing of SPACs. These firms are formed for raising funds through an initial public offer to gain a private entity and turn it into a public one. 

SPACs are quite common in numerous countries abroad, especially in the United States of America.

While addressing, the Sebi chairman touched upon a host of issues that include mandatory disclosures by companies, about which he said that corporate entities should not treat it as "check boxes".

Possibilities of allowing special purpose acquisition companies (SPACs) to function in the country are being studied, Securities and Exchange Board of India (Sebi) chairman Ajay states.

Addressing the annual Capital Market Conference organised by industry body FICCI, Ajay said that the market regulator's Primary Market Committee is evaluating the possibility of allowing SPACs to work in India.

Prevailing Sebi rules don't allow listing of SPACs. These companies are formed for raising funds through an initial public offer to acquire a private entity and turn it into a public one. 

SPACs are quite prevalent in many countries abroad, especially in the United States of America.

In his address, the Sebi chairman touched upon a host of issues including mandatory disclosures by companies, about which he said that corporate entities should not treat it as "check boxes".

Ajay says, "Documents are as important as annual reports... Companies must follow rule of disclosing material events in letter and spirit."

On the issue of corporate governance, he also hinted that FICCI should take steps to create greater awareness about it.

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