LIC Housing Finance on Saturday said the Bombay Stock Exchange and the National Stock Exchange have sought a clarification on the proposed preferential allotment to parent Life Insurance Corporation of India.

This clarification sought by the bourses is a fallout of market regulator Sebi last month asking PNB Housing Finance to put on hold its Rs 4,000-crore deal with the Carlyle group.

According to Sebi, the move was ultra-vires of its articles of association (AoA) which say that in the case of such an allotment, the valuation must be done from a registered valuer. Sebi’s decision has been challenged by PNB Housing in the Securities Appellate Tribunal.

At the hearing recently, the senior counsel for PNB Housing had said a couple of other firms had also priced their preferential issues on the basis of Sebi’s ICDR rules and there was no objection from the regulator.

Sebi recently began a preliminary enquiry into the preferential issue of LIC Housing Finance and another listed firm and it had asked the stock exchanges to examine the proposed allotment.

Last month, LIC Housing Finance had said that its parent will infuse an equity capital of about Rs 2,334.70 crore by picking up an additional stake. The company was proposing to issue shares at Rs 514.25 apiece to the promoter and the plan was to issue preferential shares up to 4,54,00,000 through a private placement to LIC. For this, an extraordinary general meeting EGM will be held on July 19 to seek the nod of its shareholders. LIC Housing Finance had then said that the issue price at Rs 514.25 per share is the price calculated under Sebi regulations, 2018.

In a regulatory filing on Saturday, the company disclosed that it received communication from both the bourses on July 12 seeking clarifications on compliance with the provisions of its AOA. “The company has clarified that there is no violation of the provisions of AoA as the price has been determined in accordance with the relevant provisions of the AoA as well as the Companies Act, 2013 and Sebi (Issue of Capital and Disclosure Requirements) Regulations, 2018,” LIC Housing Finance said.