SEBI Imposes Rs 5 Lakh Fine on AGI Greenpac for Disclosure Failures

The Securities and Exchange Board of India (SEBI) has fined AGI Greenpac Rs 5 lakh for failing to provide accurate and adequate information to shareholders, resulting in misrepresentation to stock exchanges.

The SEBI order charged the company for withholding crucial information regarding its deal to acquire Hindustan National Glass (HNG).

According to SEBI, AGI Greenpac did not disclose critical information about the acquisition deal, including crucial information regarding a show-cause notice from the Competition Commission of India (CCI), modifications to AGI’s application to the CCI, and litigation concerning the CCI’s approval of the proposed merger between AGI and Hindustan National Glass (HNG).

The acquisition was expected to make AGI Greenpac the largest player in India’s container glass industry. However, the CCI raised concerns about the deal’s potential to impede competition, forming a prima facie opinion that the transaction could have an appreciable adverse effect on competition (AAEC) in relevant markets.

During the period from April to October 2023, AGI Greenpac’s stock surged by 236%, rising from Rs 334 to Rs 1,089. Following the announcement of the penalty, AGI Greenpac’s stock closed at Rs 667.35 marking a decline of 2.85%.

SEBI has mandated that AGI Greenpac pay the penalty within 45 days of receiving the order. Failure to do so could result in recovery proceedings under Section 28A of the SEBI Act, 1992, including the attachment and sale of movable and immovable properties.