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Securities and Exchange Board of India (SEBI)

Electronic book mechanism for issuance of debt securities on private placement basis   

(Notified vide Circular No.CIR/IMD/DF1/48/2016 dated 21st April, 2016)

In order to streamline procedures for issuance of debt securities on private placement basis and enhance transparency to discover prices, it has been decided by SEBI to lay down a framework  for  issuance  of  debt  securities  on private placement basis through an electronic book mechanism.

To begin with, this electronic book mechanism has been mandated for all private placements of debt securities in primary market with an issue size of Rs.500 crores and above, inclusive of green shoe option, if any.

The   following   issuers   shall   have   an   option   to   follow   either   electronic   book mechanism or the existing mechanism:

  1. Issues with a single investor and where coupon rate are fixed. However, arrangers acting as underwriters shall not be considered as single investors.
  2. Issues wherein the issue size is less than Rs. 500 crores inclusive of green shoe option, if any.

However, for all  issues  below  Rs.500 crore,  issuer  shall  disclose  the  coupon, yield,  amount  raised,  number  of  investors  and  category  of  investors  to  the Electronic Book Provider and/ or to the information repository for corporate debt  market as notified by SEBI, in the format as specified

Through this circular SEBI has defined the roles and responsibilities of Electronic Book Provider and other participants involved in the electronic book mechanism and has also provided procedure for electronic book mechanism.

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