Authority: Kamlesh Chandra Varshney, Whole Time Member, Securities and Exchange Board of India

Order Date: November 03, 2026

Case Overview

The order addresses an application filed by Mrs. Rinku Appalwar and Mr. Makrand Appalwar, trustees of Rinku Appalwar Business Trust and Makrand Appalwar Business Trust (collectively Acquirer Trusts), seeking exemption from open offer requirements under regulations 3(2), 4, and 5 of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 (SAST Regulations). The application was submitted on May 05, 2026, with additional communications on June 23, August 13, September 02, and September 18, 2026.

The proposed acquisition involves direct and indirect transfer of promoter shareholding in Emmbi Industries Limited (Target Company) to the Acquirer Trusts as part of succession planning within the Appalwar family. The Target Company has an issued and paid-up share capital of ₹19,24,02,500 divided into 1,92,40,250 equity shares of ₹10 each, with promoters holding 62.95% (121,11,103 shares) and public shareholders holding 37.05% (71,29,147 shares) as of March 31, 2026.

Rinku Trust proposes to directly acquire 23,67,746 equity shares (12.31%) from Mrs. Rinku Appalwar, 160 equity shares (16%) of Emmbi Laboratories Private Limited (ELPL), and 2,25,000 equity shares (52.33%) of Maithili Agrotech Private Limited (MAPL), thereby indirectly acquiring control over 5.52% of Target Company shares through MAPL.

Makrand Trust proposes to directly acquire 38,39,550 equity shares (19.96%) from Mr. Makrand Appalwar, 740 equity shares (74%) of ELPL, 3,40,000 preference shares (52.31%) of ELPL, and 2,05,000 equity shares (47.67%) of MAPL, thereby indirectly acquiring control over 8.64% of Target Company shares through ELPL.

The Acquirer Trusts argued that the transaction qualifies for exemption under Chapter 8 of SEBI Master Circular No. SEBI/HO/CFD/PoD-1/P/CIR/2023/31 dated February 16, 2023, as it represents an internal reorganization for succession planning without change in ultimate ownership or control. The trustees and beneficiaries are all family members (promoters or their immediate relatives/lineal descendants), and the post-acquisition shareholding pattern remains identical to pre-acquisition levels.

Final Outcome

SEBI granted exemption to Rinku Appalwar Business Trust and Makrand Appalwar Business Trust from complying with open offer requirements under regulations 3(2), 4, and 5 of SAST Regulations, 2011. The exemption is subject to conditions including: (a) compliance with Companies Act, 2013 and other applicable laws; (b) filing a post-acquisition report with SEBI within 21 days of completion; (c) accuracy of statements in the application; (d) compliance with undertakings and Master Circular provisions; and (e) ensuring trust deeds align with conditions. The exemption is limited to open offer requirements and remains valid for one year from the order date (until November 03, 2027), requiring completion of acquisition within this period.

Topics: SEBI Exemption, Takeover Regulations, Succession Planning