SEBI cautions investors about investments in two Sahara Group companies
07 January 2011
Cautioning investors about two Sahara Group companies that have been raising funds without its approval today, market regulator SEBI said it would not be able to redress any investor complaints pertaining to the firms.
In a public notice, the regulator said investors in Sahara India Real Estate Corporation Ltd (SIRECL) and Sahara Housing Investment Corporation Ltd (SHICL) would be taking decisions at their own risk.
"Sebi will not be able to provide redress to any investor on any complaint in connection with these OFCDs (optionally fully convertible debentures)", the notice said. The notice pointed out that the two companies had not sought regulatory approval from Sebi for raising funds.
According to SEBI the two Sahara group companies had been raising funds through OFCDs that ''were not issued in compliance with the applicable Sebi regulations.''
Further, according to the notice, "the Red Herring Prospectus submitted to RoC (Registrar of Companies) has not been vetted by Sebi with reference to compliance to SEBI regulations."
SEBI said the public notice had been "issued to safeguard the interest of investors."
The regulator further said it had been receiving complaints alleging the companies had been issuing OFCDs to the public for many months with varying face value and maturity period extending up to 15 years.