Sebi closed file on the Rs 3,450-crore IPO proposal last week without any go-ahead for public issue, after various clarifications sought from merchant bankers for the share sale remained pending for months together.
Sebi had received the draft prospectus for the Initial Public Offer (IPO) on September 30, 2009 through merchant banker, Enam Securities Private Limited.
In its weekly update on status of IPO proposals, SEBI today said "File (has been) closed" on Sahara Prime City offer. Till last week's status update, Sebi was "awaiting clarifications".
It was after the receipt of the Draft Red Herring Prospectus (DRHP) for Sahara Prime City's IPO that Sebi started receiving numerous complaints against Sahara group and the subsequent investigations led to the high-profile order from the regulator against two Sahara firms.
The 34-page interim order against Sahara group, passed on November 24, 2010 by Sebi's then whole-time member K M Abraham, began with a reference to Sahara Prime City's DRHP for the proposed IPO and later listed out complaints with respect to disclosures made in the IPO document.
Sahara Prime City, a real estate entity of Subrata Roy-led Sahara group, had sought to raise up to Rs 3,450 crore through the IPO, including a green shoe option of Rs 450 crore, to raise funds for its various housing projects across the country.
Following receipt of complaints regarding this IPO, Sebi had sought clarifications from Enam Securities in April 2010, regarding the OFCDs (Optionally Fully Convertible Debentures) issued by Sahara India Real Estate Corp Ltd (SIRECL) and Sahara Housing Investment Corp Ltd (SHICL).
Later in May, Sebi sought these clarifications directly from the two Sahara firms, but was not satisfied with the replies submitted to its multiple queries.
Not satisfied with the replies, Sebi began its formal probe into the OFCD issue in August 2010 and passed its interim order in November that year.
These OFCDs are at the centre of the high-profile case between Sebi and Sahara group, which later reached the Supreme Court and the two companies were asked by the apex court on August 31, 2012 to refund over Rs 24,000 crore raised through issuance of these bonds to more than three crore investors.
Accusing Sahara of not complying with the court orders, Sebi has already ordered attachment of properties of the two companies and their top officials including group chief Subrata Roy and has also sought directions for his arrest.
Sahara group, however, claims that it has already repaid a bulk of the investors and its total outstanding liability is much less than Rs 5,120 crore already submitted to Sebi towards the refund.