Substance Over Form In India’s Open Offer Regime
Atishay Jain & Kashvi Singla, BBA LLB, Symbiosis Law School, Noida
ABSTRACT
India’s open offer regime, set out under the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011, was designed to give public shareholders a fair exit whenever control of a listed company changes hands. This piece looks at how the rule actually plays out in practice, not just on paper. It walks through when an open offer kicks in, how courts have read the idea of “control,” and what happens when control shifts through indirect routes like inter-corporate loans or court-approved schemes, where the usual triggers don’t apply in an obvious way.
The Adani-NDTV deal is used as a working example. The takeover went through every formal SEBI requirement and the price followed the prescribed formula, yet NDTV’s founders walked away with a far better price than the open offer gave ordinary shareholders. Nothing here was unlawful, but it exposes the real gap between following the rules and actually treating minority shareholders fairly.
The broader argument is that the regime has done real good. It has made acquisitions more predictable and given minority shareholders a way out when control changes. But ticking the procedural boxes doesn’t always mean shareholders get a fair deal, especially in indirect or privately structured acquisitions. The piece argues that regulators and courts need to keep looking past form and into substance, while being careful not to over-regulate in a way that scares off legitimate deals.
