Anil Ambani group settles Sebi probe against R-Infra, RNRL

Written by: Pti
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Mumbai, Jan 14 (PTI) Anil Ambani group companies RelianceInfra and RNRL today settled a Sebi probe into possibleviolation of securities market norms by them for a collectivesettlement charge of Rs 50 crore.

In a consent order passed today, the Securities andExchange Board of India (Sebi) said that it has agreed tosettle the case after the two companies agreed to its certainterms and conditions, including the payment of settlementcharges.

The case relates to a probe by Sebi in dealings in theshares of another Anil Ambani group firm RelianceCommunications and investigations related to alleged violationof foreign investment norms.

As per the conditions of the settlement, the two companieswould not be able to invest in any listed shares in thesecondary market, other than mutual funds, until December 2012and the individuals named in the case, which includes chairmanAnil Ambani, can not invest in secondary market untillDecember 2011.

However, this condition will not apply to primary marketissuances, buybacks and open offers.

Commenting on the Sebi order, a Reliance Infrastructurespokesperson said: "Reliance Infra has voluntarily settledSEBI show-cause proceedings of June 2010 against the companyand its directors.

"In accordance with SEBI consent mechanism, thesettlement is without admission or denial of guilt. Settlementmade in interests of investors to pre-empt unnecessary andtime-consuming litigation."

The company said that their directors have voluntarilymade payment of entire settlement fees, with no burden onReliance Infra, and added the settlement maintains fullfinancial flexibility of the company to implement its growthprojects.

As per the order, the two companies would also have toimplement a policy of rotating their statutory auditors and,therefore, the auditors as on March 2010 cannot be reappointedfor a period of three years commencing from 2010-11.

Sources said that the companies have already implementedthe rotation of auditors policy is in accordance with riskmanagement best practices.

The companies voluntarily offered to not make investmentsin secondary market to conserve resources for investment inown substantial projects, and will not impact growth prospectsin any manner, the sources close to the development said.

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