India's DLF barred for three years over defraud allegations

Posted On Tuesday, 21 October 2014 10:38 Published by
Rate this item
(0 votes)

India's property developer DLF, appeals rulling from raising money on financial markets over allegations it sought to defraud investors.

Singh DLF

DLF said it had filed an appeal challenging the order by the Securities and Exchange Board of India (SEBI), one of the toughest ever handed down by Indian regulators. The order accused the New Delhi-based company of "deliberate suppression of important information" in a huge initial public offering (IPO) in 2007.

Some $1.2 billion was wiped last Tuesday from the family-run company's market value following the regulator's decision, and the shares have continued to slide. The company's stock closed down 28.5 percent at 104.95 rupees on Friday.

DLF said in a statement that the first appeal hearing would take place at the Securities Appellate Tribunal on October 22. The SEBI order, issued just over a week ago, blocks debt-laden DLF, its wealthy founder-chairman Kushal Pal Singh and five other people from any sale, purchase or other dealings in the security markets for three years.

The ruling was the latest blow for the company, which pioneered development of the Indian capital's fast-growing satellite city Gurgaon. DLF, which builds apartment complexes, malls and office towers, has been hard hit by weak home sales triggered by India's sharp economic slowdown.

The SEBI ban means DLF will be unable to tap financial markets to raise funds to reduce its 190-billion-rupee ($3-billion) debt. The real estate company, which has annual turnover of 100 billion rupees, has sought to assure investors it did not contravene the law "either during its initial public offer or otherwise".

DLF said it had been guided by "eminent legal advisors" in preparing the IPO documents and promised to "defend itself to the fullest extent". The company added it was confident of "vindication" over its actions involving the IPO, which raised $2.25 billion in July 2007 at the time, the country's largest ever debut share issue. The Singh family still hold a 75 percent stake in the company.

Most Popular

Fairvest to become fourth property company to list on A2X

Oct 30, 2019
DARREN WILDER
Fairvest Property Holdings, a real estate investment trust with a market cap of R2…

Pam Golding Properties Annual Residential Property Report 2019

Nov 08, 2019
SA Reserve Bank
Signs that the residential property market is beginning to stabilise.

Diverse range of residential and commercial properties on BidX1’s next online property auction

Oct 22, 2019
BIX1 AUCTION 1
A diverse array of residential and commercial properties with lucrative investment…

Atterbury launches its new co-working concept, Attspace

Oct 22, 2019
ATTSPACE1
Atterbury is making its first foray into shared workspaces with its new Attspace…

Prime commercial and residential development opportunities and investment properties on auction

Oct 22, 2019
 LOT 8 2
Business owners, entrepreneurs and developers seeking commercial or residential property…

Please publish modules in offcanvas position.