Reuters Market Eye - Shares in Gillette India Ltd (NSI:GILLETTE.NS - News) surge 10.88 percent after the Securities and Exchange Board of India (SEBI)allows the company to re-classify one of its promoters as a public shareholder in order to become compliant with India's minimum public shareholding rules.
Kolkata-based business house Poddar Group, which owns 12.86 percent of the company, would now dispose off a 6.86 percent stake in Gillette India in order to be considered a public shareholder, Gillette said in a statement.
Poddar Group will terminate its shareholder agreement with P&G related to Gillette and also withdraw its nominees from the Gillette board.
SEBI also imposed certain other restrictions on Poddar Group related to management appointment and special rights related to Gillette.
The regulator had earlier imposed certain penalties on the company's promoters for failing to comply the shareholding rules. Gillette had been locked in a dispute with SEBI and its appellate tribunal regarding the shareholding structure for the last several months.
As per India's new minimum public shareholding rules, promoters cannot hold more than 75 percent in any listed company in the private sector in India.
(Reporting by Himank Sharma)