To enhance transparency and efficiency of the delisting process, Sebi has said independent directors will have to give reasoned recommendation on such proposal, while the promoters need to disclose their intention to delist the firm through an initial public announcement.

To give effect to this, the Securities and Exchange Board of India (Sebi) has amended delisting rules, according to a notification dated June 10.

This comes after the board of Sebi approved several amendments to delisting norms in March to make the process more transparent and efficient.

Under the new rules, timelines for completion of various activities forming part of the delisting process have been introduced or revised to make it more efficient.

Sebi said the committee of independent directors will be required to provide their reasoned recommendations on the delisting proposal.

Promoter or acquirer will be required to disclose their intention to delist the company by making an initial public announcement.

Currently, the promoter or acquirer's proposal to voluntarily delist the company is disclosed to the exchanges by the company's board, while the obligation to disclose the intention to voluntarily delist the firm to the public is not cast on the promoter or acquirer.

Further, the promoter or acquirer entity will be permitted to specify an indicative price for delisting, which should not be less than the floor price. This would help the investors gauge the inclination of the promoters and their willingness to pay such a price.

Besides, the promoter will be bound to accept the price discovered through a reverse book building if the same is equal to the floor price or indicative price.

In addition, the role of merchant banker involved in the delisting process has been elaborated.

According to the regulator, voluntary delisting will not be permitted pursuant to buyback and preferential, allotment, unless a period of six months has elapsed from completion of the last buyback or preferential allotment.

It, further, said that neither any company will apply for nor any stock exchange will permit delisting of equity shares of a company unless a period of three years has elapsed since the listing of that class of equity shares on any bourse.

Under the rules, for successful delisting, the acquirer has to acquire 90 per cent of the total share capital of the company.

For companies having shareholders -- vanishing companies; struck-off firms; those whose shares have been transferred to investor education and protection fund (IEPF) account -- the minimum acquisition threshold under RBB should be calculated after deducting the shareholding held by such shareholders.

The outcome of the reverse book building (RBB) in terms of its success or failure needs to be announced within two hours of the closure of the tendering period.

In respect of timeline, Sebi said the company will have to obtain the approval of its board of directors in respect of the proposal of the acquirer to delist the equity shares, within 21 days from the date of the initial public announcement.

At present, the timeline for obtaining the board's approval has not been specified.

The regulator said that a period of 15 working days from the passing of the special resolution needs to be stipulated for the company to file an application for in-principle approval by the exchanges.

"Recognised stock exchange shall not unfairly withhold such an application," Sebi said.

The public announcement for giving either a counteroffer or accepting or rejecting the discovered price will be made within two working days of the closure of the tendering period.

The cooling-off period for relisting post-delisting has been reduced to three years from the present five years.