Sebi on Friday provided two additional methods — rights issue of shares as well as the issuance of bonus shares to public shareholders — to listed companies to achieve compliance with the 25 per cent minimum public holding requirement.

The move came after Sebi received representations from listed entities and other stakeholders requesting relaxation from compliance with the conditions specified in the existing methods and approval for using non-prescribed methods to achieve minimum public shareholding (MPS) compliance.

In a circular, Sebi said listed entities can adopt rights issues of shares to public shareholders and bonus issue to public shareholders to comply with the MPS requirements.

However, promoters will have to forgo their entitlement to equity shares that may arise from such issuances.

Further, the regulator said listed companies can opt for any other method as approved by it on a case-to-case basis. In such cases, listed entities would approach Sebi with an application containing relevant details to obtain prior permission. In addition, the regulator has rationalised existing mechanisms.

With regard to existing rule of promoters selling up to a 2 per cent stake in the open market and promoters offloading up to a maximum of 5 percent stake during a financial year, subject to certain conditions, Sebi said promoters can use either of the mechanism to comply with MPS requirements, but not both.