In Brief
An acquirer (Pramod Jain and others) made a hostile public offer in November 2009 to acquire 25% of Golden Tobacco Limited. After 21 months, citing deterioration in the target company's financial position and alleged asset encumbrance, the acquirer sought to withdraw the offer. SEBI and the Securities Appellate Tribunal rejected the request. The Supreme Court upheld this, holding that under SEBI's Takeover Regulations, a public offer cannot be withdrawn except where performance becomes impossible. Mere financial loss or asset deterioration, even if caused by the target company, does not justify withdrawal. Acquirers must exercise due diligence before announcing an offer and are bound by their announcement to protect minority shareholders' interests.
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