What is an Offer for Sale (OFS) and who can subscribe to OFS? - Indian IPO Blog

Saturday, December 10, 2016

What is an Offer for Sale (OFS) and who can subscribe to OFS?

An Offer for Sale (OFS) is a form of share sale. OFS mechanism facilitates the promoters of an already listed company to sell or dilute their existing shareholdings through an exchange based bidding platform to meet the minimum public shareholding requirements in terms of Securities Contracts (Regulation) Rules.

Any nonpromoter shareholder of eligible companies (top 200 companies by market capitalization) holding at least 10% of share capital may also offer shares through the OFS mechanism.

Except the listed companies, all market participants like individuals, mutual funds, foreign portfolio investors (FPIs/FIIs), insurance companies, corporates, other qualified institutional bidders (QIBs), HUFs, NRIs etc. can bid/participate in the OFS process to buy the shares

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