Stakeholders to be cautious while subscribing open offers by companies

Markets regulator Sebi asked investors to be ‘alert’ about public announcements of share purchase plans of the companies where they have invested.A company needs to issue a ‘public announcement’ in newspapers and through stock exchanges for the benefit of investors.

The delisting and open offer decisions can impact the interest of shareholders in a big way. Therefore, the investors need to be aware about such announcements made by the companies.

An open offer is triggered when an acquirer purchases 25 per cent stake in a listed company. In that case, the buyer has to pick up an additional 26 per cent holding in the target firm.

Sebi also warned investors against schemes which promise very high returns in a short duration, including those claiming to create millionaires overnight.The regulator asked investors not to fall for schemes that assures unbelievably high returns in a very short time.

Sebi has begun exploring Twitter to spread investor awareness.

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