Capital market regulator Sebi on Wednesday decided to provide relaxation to promoters for participating in follow-on public offer (FPO). The board approved a proposal to do away with the applicability of minimum promoters' contribution norm and the subsequent lock-in requirements for the issuers making FPO of specified securities, Sebi said in a statement.

At present, promoters are mandated to contribute 20% towards FPO. Besides, in case of any issue of capital to the public, the minimum promoter’s contribution needs to be locked-in for three years. The regulator said the relaxation would be available for those companies which are frequently traded on a stock exchange for at least three years. Besides, these firms should have redressed 95% of investor complaints.

The issuer company should also be in compliance with the Listing Obligations and Disclosure Requirements Regulations for at least three years. Besides, the board decided to provide certain exemptions to alternative investment funds in respect of investment committee members.

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