Business

SEBI Slaps Rs 5 Lakh Penalty On AGI Greenpac For Disclosure Failures In HNG Acquisition Deal

In a significant move, the Securities and Exchange Board of India (SEBI) has imposed a penalty of Rs 5 lakh on AGI Greenpac, a packaging products company, citing its failure to provide accurate and adequate disclosure concerning its acquisition deal with Hindustan National Glass (HNG).

Case So Far:

The penalty stems from what SEBI deems as a misrepresentation of crucial information to the stock exchanges.

AGI Greenpac initiated the regulatory action by withholding vital details regarding its acquisition of HNG, India’s premier container glass-making enterprise.

SEBI’s order highlights AGI Greenpac’s lapse in disclosing material developments related to its submissions to the exchanges on 31 October 2022, and 16 March 2023.

Specifically, SEBI noted that AGI Greenpac neglected to reveal essential information pertaining to a show-cause notice issued by the Competition Commission of India (CCI), modifications to its application submitted to the CCI, and legal proceedings concerning the CCI’s approval of the proposed AGI-HNG combination.

During the period from April to October 2023, AGI Greenpac’s stock witnessed a remarkable surge, soaring by 236 percent from Rs 334 to Rs 1,089.

AGI Greenpac anticipated that its acquisition of HNG would position it as the leading player in India’s container glass industry.

However, the CCI raised concerns, suggesting that the proposed transaction could potentially impede competition in relevant markets.

Preceding SEBI’s penalty, Justice Vikramajit Sen, former Chief Justice of the Karnataka High Court and a Supreme Court judge, remarked that AGI Greenpac had provided “partial and deceitful disclosure” regarding CCI approval.

The SEBI order stipulates that failure to remit the penalty within 45 days could result in further actions, including recovery proceedings under Section 28A of the SEBI Act, 1992, to collect the penalty amount along with accrued interest, potentially through the attachment and sale of movable and immovable assets.

Following the announcement of the penalty, AGI Greenpac’s stock closed at Rs 667.35 on Tuesday, marking a decline of 2.85 percent.

Also Read: Adani Group Denies Speculations Of Stake Acquisition In Paytm

Mankrit Kaur

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