The document outlines the new circular issued by SEBI regarding the electronic book mechanism for private placement of debt securities. It allows for issues with a single investor, fixed coupon rates, and less than Rs. 500 crores to use an electronic book provided by a recognized stock exchange. The electronic book will allow issuers, arrangers, sub-arrangers, and institutional investors to participate in the private placement process online through a bidding portal managed by the electronic book provider according to set procedures.

1. ELECTRONIC BOOK MECHANISM FOR
ISSUANCE OF DEBT SECURITIES ON
PRIVATE PLACEMENT BASIS
CIRCULAR NO.IMD/DF1/48/2016, DATED 21-4-2016
Riddhi Pratim Dutta
Corporate Lawyer & Adviser

2. REASONS FOR NEW
CIRCULAR
• To streamline procedures for issuance of debt
securities
• To enhance transparency to price discovery

3. WHO CAN FOLLOW
ELECTRONIC BOOK
MECHANISM
• Issues with a single investor and where
coupon rate are fixed
• Issues wherein the issue size is less than Rs.
500 crores, inclusive of green shoe option

4. WHO CAN ACT AS
ELECTRONIC BOOK
PROVIDER
• The electronic book mechanism shall be
provided by recognised stock exchange with
SEBI permission
• They will be known as Electronic Book
Providers

5. ELIGIBILITY OF
ELECTRONIC BOOK
PROVIDER• On-line platform for receiving bids in private
placement
• Bidding portal/website on which it proposes to
offer its services
• Necessary infrastructures
• Electronic book mechanism so provided by EBP
would be subject to periodic audit by Certified
Information Systems Auditor (CISA)

6. WHO WILL PARTICIPATE
• Issuer
• Arranger, if any, appointed by the issuer
• Sub-arranger , appointed by the arranger
• Institutional Investors
*for definition see SEBI ICDR & ILDS regulation

7. ROLES AND
RESPONSIBILITIES
• Strict KYC adherence
• Full disclosure by issuer in PPM
• Operation procedure management by EBP

8. PROCEDURE
• Pre Bid procedure - Enrolment
• Bidding procedure - within time window and
entering bid amount
• Post bidding procedure - acceptance/rejection
of bid and public announcement

9. • Circular shall be applicable with effect
from July 01, 2016

10. THANK YOU