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The Supreme Court of India has rejected Linde India's appeal against a valuation exercise ordered by the Securities and Exchange Board of India (Sebi). Linde India, a prominent industrial gases and engineering firm, had challenged the order in the Securities Appellate Tribunal (SAT) but was unsuccessful. The company then approached the Supreme Court, raising concerns about the confidentiality of price-sensitive information that could be exposed during the valuation process. However, the Supreme Court declined to interfere with the SAT's decision, effectively greenlighting the valuation exercise to proceed.
The background of the case stems from Sebi's investigation into agreements and transactions between Linde India and its related parties, Praxair India and Linde South Asia Services. In April, Sebi directed the National Stock Exchange (NSE) to appoint a valuer to assess Linde India's business. This move followed complaints from shareholders who alleged that Linde India did not obtain their approval for material related-party transactions. The SAT, in its ruling, emphasized that the NSE's appointment of a valuer was in accordance with Sebi's directive and deemed it legal.
While Linde India initially expressed concerns about the potential for exposing sensitive information through the public disclosure of the valuation report, the SAT addressed these concerns by instructing both the NSE and Sebi to maintain confidentiality regarding price-sensitive data revealed during the valuation process. The Supreme Court, acknowledging the SAT's handling of the confidentiality aspect, upheld the tribunal's order, allowing the valuation exercise to move forward. Linde India still has a pending plea with the SAT, scheduled for October 15th, where they are seeking a stay on Sebi's entire order.
Sebi, in its order regarding the investigation, indicated that it may consider punitive measures once the probe is completed. This development underscores the regulatory scrutiny being placed on Linde India's dealings with its related parties. As the valuation process unfolds, Linde India will be under pressure to demonstrate the fairness and transparency of its past transactions. The outcome of the ongoing investigation will be significant for Linde India, potentially influencing its future operations and investor confidence.
Source: SC denies relief to Linde India, refuses to interfere with SAT's order