Chennai: Markets regulator SEBI slapped a fine of over Rs 10 crore on Sybly Industries Ltd in a matter related to manipulation in issuance of global depository receipts (GDR).
The penalty follows a probe by the regulator regarding the firm’s allotment of 1.51 million GDR amounting to $6.99 million on the Luxembourg Stock Exchange in June 2008. During the probe, SEBI observed that the entire 1.51 million GDR were subscribed by only one entity, Vintage FZE (now known as Alta Vista International FZE).
The subscription amount for GDR was paid by Vintage after obtaining loan from European American Investment Bank (EURAM). However, the loan paid by Vintage was secured by pledge agreement between Sybly and EURAM Bank, the regulator said.
SEBI further said the GDR issue would not have been subscribed if the Sybly had not given such security towards the loan taken by Vintage.