An acquirer who has made a public offer and seeks to acquire further shares under Reg. 7(1A) any purchase or sale aggregating to 2% or more of the share capital of the target company are to be disclosed to the Target Company and the Stock Exchange where the shares of the Target company are listed within 2 days of such purchase or sale along with the aggregate shareholding after such acquisition / sale. However, any additional acquisition over and above 5% can be made only after making a public announcement. (II) For the purpose of making an open offer by the acquirer:ДЄn acquirer, who intends to acquire shares which along with his existing shareholding would entitle him to more than 15% voting rights, can acquire such additional shares only after making a public announcement (вЂњPAвЂќ) to acquire at least additional 20% of the voting capital of the target company from the shareholders through an open offer.ДЄn acquirer, who is having 15% or more but less than 75% of shares or voting rights of a target company can consolidate his holding up to 5% of the voting rights in any financial year ending 31st March. The target company is, in turn, required to pass on such information to all stock exchanges where the shares of the target company are listed, within 30 days from the financial year ending March 31 as well as the record date fixed for the purpose of dividend declaration. (I) For the purpose of disclosures to be made by acquirer(s):ДЄ person who, along with вЂpersons acting in concertвЂ™ (PAC), if any, acquires shares or voting rights (which when taken together with his existing holding) would entitle him to more than 5% or 10% or 14% shares or voting rights of target company, is required to disclose the aggregate of his shareholding or voting rights to the target company and the Stock Exchanges where the shares of the target company are traded within 2 days of receipt of intimation of allotment of shares or acquisition of shares.Дў) More than 15% shares or voting rights:ДЄn acquirer, who holds more than 15% shares or voting rights of the target company, shall within 21 days from the financial year ending March 31 make yearly disclosures to the company in respect of his holdings as on the mentioned date. The said SEBI Regulations have discussed this aspect of вЂsubstantial quantity of shares or voting rightsвЂ™ separately for two different purposes: Here the term вЂsubstantial acquisition of sharesвЂ™ attains a very vital importance, irrespective whether the corporate restructuring is through merger / acquisition / takeover.

) acquires substantial quantity of shares or voting rights of the target company. Neither the term вЂtakeoverвЂ™ nor the term вЂhostileвЂ™ has been expressly defined under the said Regulations, the term basically envisages the concept of an: SEBI (Substantial Acquisition of Shares & Takeovers) Regulations, 1997 has been enacted by the Securities and Exchange Board of India which deals with acquisition of shares, takeovers, etc. It primarily, only talks about Mergers & Amalgamations through Section 391-396. That is why it is observed that so many corporations have subsidiaries that do not have anything in common - they were bought purely for financial reasons.Д¬ompanies Act 1956 does not expressly mention about takeovers or acquisitions. If a company can make $100 million in profits each year, then buying that company for $200 million makes sense. The acquiring company may think that the target company can generate more profit in the future than the selling price.

The major reason may be of financial gain instead of economic or business gain. There are several reasons why a company might want or need a hostile takeover. In India, hostile takeover is a dreaded word, may be since it is a method used which is not democratic in nature and somewhat unpleasant for the management of a target company. through which Corporate restructuring may be done.

There are other methods like Mergers & Acquisitions, Leveraged Buyout, Spin offs, etc. Hostile Takeovers is a type of method used for Corporate Restructuring. The word вЂhostileвЂ™ in dictionary means вЂunfriendly, aggressiveвЂ™. In other words, the Acquirer intends to gain control of the Target Company and force it to agree to the sale. Hostile Takeover is a type of acquisition in which, the company being purchased (Target Company) does not want to be purchased at all, or does not want to be purchased by a particular buyer (Acquirer) that is making a bid.

What is a hostile takeover