SEBI Eases Delisting Rules for PSUs with 90% Government Stake

The Securities and Exchange Board of India (SEBI) has put in place simplified rules for voluntary delisting of Public Sector Undertakings (PSUs) where the government holds 90% or more equity. The notification was issued on September 1, 2025. These rules will not apply to banks, Non-Banking Financial Companies (NBFCs), and insurance companies, even if the government holding crosses the 90% mark.

Relaxation in the Approval Process

Earlier, delisting required the consent of at least two-thirds of public shareholders. SEBI has now removed this requirement for eligible PSUs. This change reduces one of the key steps that previously made the process longer.

Fixed Price Option Introduced

The usual reverse book-building process for deciding delisting prices will not be followed under the new framework. Instead, a PSU can delist at a fixed price if it is at least 15% higher than the floor price. This option will remain available regardless of the stock’s trading activity.

Basis for Floor Price

The floor price will be the highest among the 3 values. These are the volume-weighted average price of trades during the 52 weeks before the reference date, the maximum price paid in the 26 weeks before the reference date, and the price arrived at in a joint valuation report prepared by 2 independent registered valuers.

Shareholder Protection Measures

For shareholders who do not tender their shares during the one-year exit window after delisting, Sebi has asked for unpaid consideration to be deposited with the designated stock exchange within 30 days of the window’s closure. The funds will remain in the account for seven years, allowing investors to claim them at any time within that period.

Read more: SEBI Revises Settlement Dates: Here’s What You Need to Know!

Conclusion

The new rules adjust the approval, pricing, and settlement process for PSUs where the government holds at least 90%. They also set out a timeline for handling unclaimed shareholder payments.

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