SEBI- Amendments to guidelines for preferential issue and institutional placement of units by a listed InvIT

1.SEBI issued circular SEBI/HO/DDHS/DDHS/CIR/P/2019/143dated November 27, 2019 providing guidelines for preferential issue and institutional placement of units by listed InvITs(“Guidelines”).The guidelines were subsequently revised vide circular SEBI/HO/DDHS/DDHS/CIR/P/2020/36dated March 13, 2020.

2.In viewof the situation emerging out of the COVID-19 pandemicSEBI has granted certain relaxations for raising of equity capital. On similar linesthe extant guidelines for preferential issue and institutional placement of units by listed InvITsstand modified as set out intheAnnexureto this circular.

3.This circular is being issued in exercise of powers conferred under Section 11(1) of the Securities and Exchange Board of India Act, 1992 and Regulation 33 of the InvITRegulations.

4.This Circular is available on the website of the Securities and Exchange Board of India at www.sebi.gov.in under the category “Legal” and under the drop down “Circulars”.

1. Clause 2.6 of the Guidelines is modified as under:
“The InvIT shall not make any subsequent institutional placement until the expiry of two weeks from the date of the prior institutional placement made pursuant to one or more special resolutions.”

2. After clause2.1 and before clause2.2 of sub-paragraph(A) of paragraph2 of Annexure-I, the following provisos shall be inserted:
“Provided that, for any preferential issue made between the date of this circular and December 31, 2020, the InvITmay opt for a pricing method where the price of the units to be allotted pursuant to the preferential issue shall not be less than the higher of the following:
(a)the average of the weekly high and low of the volume weighted average price of the related units quoted on the recognised stock exchange during the twelve weeks preceding the relevant date; or
(b)the average of the weekly high and low of the volume weighted average prices of the related units quoted on a recognised stock exchange during the two weekspreceding the relevant date.
Provided further that, units allotted on a preferential basis using the pricing method set out in the first proviso shall be locked-in for a period of three years:
Provided further that, all allotments arising out of the same unitholders approval shall follow the same pricing method.”

3.After clause 3.1 of paragraph 3 of Annexure-I, the following explanation shall be inserted:
Explanation: For the computation of the lock-in requirement, the units held by the sponsor(s) and locked-infor three years, in the past in terms of Regulation 12(3) of the InvITRegulations shall be taken into account. The units locked-in pursuant to Regulation 12(3) of the InvITRegulations shall not be put under fresh lock-in again, even though they are considered for computing the lock-in requirement, in case the said units are free of lock-in at the time of the preferential issue.