Road Map for Open Offer Procedure (OOP) under SEBI Takeover Regulation 2011 

A takeover Offer is a type of action in which a an offer is being made to acquire another Listed Company. It could be made by an Individual or a Group or Any Legal Entity, which is known as the acquirer, while the subject matter of the bid is referred to as the target company. The takeover Offer could be a Friendly offer or could be a Hostile Offer.

Securities and Exchange Board of India (substantial acquisition of shares and Takeovers) Regulations, 2011 is the primary piece of Law which regulates Takeovers of Listed Companies in India

An Open Offer is made to the Public shareholders of Target Company pursuant to a Trigger event as prescribed in regulations to provide them an Exit Opportunity in case the Public shareholders are not willing to continue with the Company and/or upcoming Management pursuant to Takeover Offer.

A Merchant Banker called as Manager to the Offer is a Registered Intermediary who make sure that SEBI (SAST) Regulations are well complied in the Offer and in addition act to prevent any loss to any Public shareholder.

Takeover is acquisition of substantial shares and control over the Target Company to expand or to diversify the business in an inorganic manner.

Following tasks to be involved in take over of listed entity: i.e. open offer process under regulation 3-27 of takeover code 2011

Sr. No.

Provisions/ Regulations Requirements / Tasks involved Documents required Responsibility Remarks
Step 1 Appointment of Merchant Banker (Regulation 12) Board Resolution at Board Meeting Pass BR and filing of MGT-14 to ROC Acquirer Intimation to Stock exchange under regulation 29 and 30 of SEBI LODR 2015.
Step 2 Trigger Event (Regulation 3/4/5) Share purchase agreement
Resolution for allotment of securities
Acquisition of shares beyond
threshold limit
Basic document for entering into agreement Acquirer with
PAC & Target
Here Legal department comes into picture to execute the agreement
Step 3 Public Announcement
(Regulation 13)
Short Public Announcement to Stock Exchange, SEBI and TC Manner specified in
regulation 13
Merchant Banker
Step 4 Escrow Account For takeover transaction (Regulation 17 and read with regulation 21) Entering into Escrow Agreement Merchant Banker & Acquirer & Escrow Banker
Step 5 Escrow Account
(Regulation 17)
Opening of Bank Escrow & Special
Rupee account
checklist provided by the banker ( Escrow agreement is mandatory and PAN of corporate) Merchant Banker
& Acquirer &
Escrow Banker
Not later than 2 WDs prior to DPS

DPS = Detailed public statements

WD = working days

Step 6 Escrow Amount
(Regulation 17)
Deposit of Escrow Amount in Escrow account Acquirer Not later than two working days prior to the date of the
detailed public statement
Step 7 Publication of Detailed
Public Statement in
newspapers (Regulation 14)
Simultaneously with publication of
such detailed public statement in the
newspapers, a copy of the same shall
be sent to – Board, Stock exchange
and Target company
Contents of Public
announce-ments as per
regulation 15
Merchant Banker Within five working days
from the date of the detailed
public statement
Step 8 Fees to Stock exchange
(Regulation 16)
Provide Demand Draft for SEBI to
Merchant Banker
other mode specified by

Within five working days

from the date of the detailed
public statement
Step 9 Filing of Letter of Offer with the SEBI (Regulation 16/18) Dispatch of Draft Letter of Offer to SEBI, Stock Exchange and TC In the manner prescribed
under regulation
Merchant Banker Post submission of Draft Letter of Offer with SEBI, Merchant Banker will co-ordinate with SEBI and would discuss all the queries. Basis upon which, SEBI will issue its observation letter for the Open Offer.
Step 10 Draft Letter of offer (Regulation 18) Receipt of Draft Letter of Offer by SEBI, Stock Exchange and sent to
Merchant Banker
Step 11 Competing offer, if any (Regulation 20) Last date for competing Offer u/r 20(1) Any person other than Acquirer
Step 12 Comment by SEBI
(Regulation 16(4))
Receipt of comments from SEBI on
draft letter of offer
 – Merchant Banker The Board shall give its comments on the draft letter
of offer as expeditiously as possible but not later than fifteen working days of the receipt of the draft letter of
Step 13 Incorporating the
observation in letter of offer (Regulation 161
Board may call for a revised letter of offer in case of inadequacy of
Merchant Banker The period for issuance of comments shall be extended to the fifth working day from the date of receipt of satisfactory reply to the clarification or additional information sought
Step 14 As per the definition under
regulation 2(1)(k)
Identified date for determining name of shareholders to whom the letter of offer should be sent Merchant Banker “identified date” means the date falling on the tenth working day prior to the commencement of the tendering period, for the purposes of determining the shareholders to whom the letter of offer shall be sent
Step 15 Draft letter of offer to be sent to NSDL/ CDSL
(Regulation 18(3))
Draft khan of offer to be sent to NSDL/ CDSL (depository) of the target company Draft letter of offer Acquirer
Step 16 Letter of offer to
(Regulation 18(2))
Dispatch of the Letter of Offer to shareholders The letter of offer shall be
dispatched to the shareholders whose names appear on the
register of members of the
target company as of the identified date
Merchant Banker Not later than seven working days from the receipt of comments from the Board or where no comments are offered by the Board, within seven working days from the expiry of the period stipulated in sub-regulation
(4) of regulation 16.
Step 17 Last date for Upward revision in offer (Regulation 18(4)) Last date for Upward revision in offer Cum case of competing offer) Merchant Banker
& Acquirer
One working day before the commencement of the tendering period.
Step 18 Recommen-dations on the open offer by Independent
directors (Regulation 26(7))
Last date for Comments on the offer by independent directors of TC.
simultaneously, a copy of the same shall be sent to SEBI, Stock exchange
and manager
Merchant Banker & TC committee of independent directors shall provide its written reasoned
recommen-dations on the open offer to the shareholders of the target company
Step 19 Advertisement announcement (Regulation 18(7)) Issue of advertisement announcing the
schedule of activities for open offer
Merchant Banker & Acquirer One working day before the commence-ment of the tendering period.
Step 20 Opening of offer (Regulation 18(8)) Date of Opening of offer
(Tendering period)
Merchant Banker
& Acquirer
Permissible tendering period
shall be 10 to 12 days
Step 21 Closing of offer (Regulation 18(10)) Date of Closing of offer Merchant Banker
& Acquirer
Within ten working days from the last date of the tendering period, complete all requirements
Step 22 Post offer advertisement
(Regulation 18(12))
Post offer advertisement,
simultaneously sent to the SEBI, stock
exchange and target company
Details including
aggregate number of shares tendered, accepted, date of payment of
Merchant Banker
& Acquirer
Within five working days after the offer period
Step 23 Payment of Consideration (Regulation 21(2)) Payment of consideration whether in
the form of cash, or as the case may to all shareholders who have tendered shares in acceptance of the open offer.
–  Merchant Banker
& Acquirer
Within ten working days of the expiry of the tendering period
Step 24 Filing of report and execution of agreement (Regulation 27(7)) Filing of report to SEBI by Merchant Banker Report – confirming status of completion of various open offer requirements Merchant Banker, Seller & Acquirer Within fifteen working days from the expiry of the tendering period
Other aspects to be considered under takeover code and LODR and PIT regulations
1 Regulation 37(1) of Listing Regulations Filing of scheme with stock exchanges Any listed company undertaking or
involved in a scheme of arrangement  must file the daft scheme with the relevant stock exchange, to seek an observation letter or no-objection letter from the relevant stock
Draft Scheme Acquirer
2 Regulation 11 of the Listing
Compliance with securities
The listed companies shall ensure that the scheme does not violate, limit or
override any of the provisions of the applicable securities law or requirements of the stock exchanges.
3 Regulation 69(2) of Listing
Change in shareholding
The listed companies are required to file the pre and post arrangement
shareholding pattern and the capital structure with the stock exchanges
Shareholding Pattern Acquirer
4 Regulation 51 of Listing
Corporate actions pursuant
to merger
The listed company needs to disclose to the stock exchanges all information
having a bearing on the performance /
operation of the listed entity and / or
price sensitive information.
Information and price sensitive information Acquirer
5 Regulation 3(3) of the PIT
The PIT Regulations contain a specific carveout for communication
and procurement of information (conduct of due-diligence) in connection with transactions involving mergers and acquisitions
UPSI Acquirer UPSI means Unpublished price sensitive information
6 Trading windows The trading window shall be closed when the compliance officer determines that a designated person or class of designated persons can reasonably be expected to have possession of unpublished price sensitive information. UPSI Acquirer
7 Obligations of the manager
to the open offer
(Regulation 27(3))
The manager to the open offer shall furnish to the Board a due diligence certificate along with the draft letter of offer filed under regulation 16. DD certificate Merchant Banker

DD – Due Diligence

Reference: htips:// hnps://

https://www.sebi.govintlegal/master-circulars/feb-2023/master-circular-for-substantial­a uisition-of-shares-and-takeovers_68091.html



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