Sebi Exempts Mehta Family Trust from Open Offer for Saurashtra Cement

The Securities and Exchange Board of India (Sebi) has exempted the Mehta Family Trust from making an open offer for the proposed indirect acquisition of shares and voting rights in Saurashtra Cement Ltd. This decision was made on Tuesday, July 14, 2026, in New Delhi.

The proposed transaction involves Jay Mahendra Mehta transferring his 49.99 per cent stake in Galaxy Technologies Pvt Ltd to the trust, while Juhi Chawla Mehta will transfer her 50.04 per cent profit sharing and voting rights in Omna Enterprises LLP to the trust. These companies are part of the promoter and promoter group of Saurashtra Cement Ltd and together hold a 24.04 per cent stake in the company.

The Mehta Family Trust was registered in 2019 and has Juhi Chawla and her husband, industrialist Jay Mehta, as trustees. Sebi noted that the proposed indirect acquisition would normally trigger an open offer under the takeover norms.

However, Sebi granted an exemption after observing that the transaction is part of an internal reorganisation of the promoter family aimed at streamlining succession planning and consolidating family holdings. The regulator stated that the acquisition is non-commercial in nature and would not prejudice the interests of public shareholders.

According to the order, there will be no change in control of Saurashtra Cement Ltd pursuant to the proposed acquisition. The company's promoter group will continue to hold 66.62 per cent, while public shareholding will remain at 33.38 per cent.

Sebi also noted that the trust comprises only promoters, their immediate relatives, and lineal descendants, making it a mirror image of the existing promoter holding structure. The regulator said the exemption is subject to conditions, including the filing of a report within 21 days from the date of acquisition.

The exemption from open offer obligations is valid for one year from the date of the order, within which the proposed acquirer must complete the acquisition. If the acquisition is not completed within this timeframe, the exemption will lapse and cease to exist.

Sebi clarified that the exemption is limited to open offer requirements and does not waive other compliance obligations under applicable regulations.

The decision by Sebi is significant as it allows the Mehta Family Trust to reorganise its holdings in Saurashtra Cement Ltd without having to make an open offer to the public shareholders. This move is likely to benefit the trust and the company, as it will allow for a more streamlined and consolidated ownership structure.

In the context of Indian securities regulations, this decision highlights the importance of internal reorganisation and succession planning for promoter groups. It also demonstrates Sebi's willingness to consider the specific circumstances of each case when making decisions about exemptions from regulatory requirements.

Overall, the exemption granted to the Mehta Family Trust by Sebi is a notable development in the context of Indian securities regulations and highlights the complexities of takeover norms and their application in different scenarios.

This decision is likely to have implications for other companies and promoter groups in similar situations, as they seek to reorganise their holdings and consolidate their ownership structures. As such, it is an important development for the Indian business community and for anyone interested in the intricacies of securities regulation in the country.

In conclusion, the Sebi's decision to exempt the Mehta Family Trust from making an open offer for the proposed indirect acquisition of shares and voting rights in Saurashtra Cement Ltd is a significant one, and its implications will be closely watched by the business community and regulatory experts in the coming months.