SEBI Puts Go Airlines IPO On Hold Over Pending Probe Against Bombay Dyeing
India’s market regulator has put the approval of Go Airlines (India) Ltd.’s initial public offering on hold in at least the second such recent action amid a rush for maiden offers.
The Securities and Exchange Board has put in abeyance the approval process of the draft red herring prospectus of Wadia Group-owned carrier, according to the communication on its website.
An email to SEBI seeking clarification remained unanswered.
According to a person aware of details, the IPO approval has been put on hold since SEBI has issued summons and has been investigating the group flagship The Bombay Dyeing and Manufacturing Co. in the last three weeks. The market regulator can take up to 90 days to complete the investigation and issue an order under this process.
SEBI has issued notice to Bombay Dyeing over financial disclosures, said the person who did not want to be identified as details aren’t public yet.
In an emailed response to BloombergQuint, Go Airlines said it has received no communication from SEBI.
The regulator has also put Aditya Birla Asset Management Co.’s IPO on hold. People aware of the matter said that too was because of an ongoing investigation.
The operator of GoAir, now renamed Go First, had filed its DRHP on May 17 to raise Rs 3,600 crore through a fresh issue. The regulator, according to SEBI’s website, sought clarification on June 11.
According to the DRHP, the market regulator in January 2019 had intimated Bombay Dyeing about a complaint lodged by one of its shareholders alleging, among other things, that a scheme of arrangement between Bombay Dyeing and SCAL Services Ltd. sanctioned by the National Company Law Tribunal on Feb. 21, 2019, was fraudulent.
The regulator issued summons in July 2020 seeking information and documents from Bombay Dyeing; Nusli Wadia, chairman; Jehangir Wadia, managing director; Ness Wadia, director; Keki Elavia, chairman of audit committee; and Vinesh Jairath, member of the audit committee.
SEBI sought more information in February, March and April. Bombay Dyeing sought an extension of four weeks.
According to the company's disclosure to the BSE, Jehangir Wadia has stepped down as the managing director as his term “expired” on March 31. It cited “objective of professionalisation of the management” as the reason.