Sebi Issues Framework for fast-track follow-on offer by REITs, InvITs

March 29^th, 2025

The Securities and Exchange Board of India (SEBI) has introduced a framework to streamline fast-track follow-on public offers (FPOs) by Real Estate Investment Trusts (REITs) and Infrastructure Investment Trusts (InvITs), aiming to enhance fundraising efficiency in these sectors.

Key Highlights of the Framework:

1. Sponsor Lock-in Requirements:
• 15% of units allotted to sponsors and sponsor groups in a preferential issue are locked in for three years from the date of trading approval.
• The remaining units are subject to a one-year lock-in period.
2. FPO Process Simplification:
• REITs and InvITs must apply for in-principle approval from all stock exchanges where their units are listed, designating one as the primary exchange.
• Units must be issued in dematerialized form.
• A minimum public unit holding of 25% is required post-issue.
3. Documentation and Compliance:
• The FPO document, incorporating SEBI's observations, must be filed with the regulator and recognized stock exchanges.
• Merchant bankers are responsible for submitting a due diligence certificate alongside the draft offer document.
4. Inter se Transfer Clarification:
• SEBI has provided clarity on the transfer of units among sponsors or sponsor group entities within a REIT or InvIT.

These measures are designed to facilitate quicker access to capital for REITs and InvITs, promoting growth in India's real estate and infrastructure sectors.

Source:https://realty.economictimes.indiatimes.com/news/industry/sebi-issues-framework-for-fast-track-follow-on-offer-by-reits-invits/119687451?utm_source=top_news&utm_medium=tagListing