Decks have been cleared for the initial public offering (IPO) of Tamilnad Mercantile Bank as the Securities Appellate Tribunal (SAT) dismissed petitions filed by the minority shareholders of the private sector lender against the float.

Six shareholders of the bank had sought a stay on the IPO as the offer for sale (OFS)that was initially planned was scrapped.

The lender’s initial papers filed with the Securities and Exchange Board of India(Sebi) had two components: an offer for sale (OFS) and fresh issue of shares. However, the red herring prospectus filed in August this year came without the OFS.

The six shareholders that have disputed this step included Robert and Ardis James Co, East River Holdings, Swiss ReInvestors (Mauritius), Kamehameha Mauritius, CunaGroup (Mauritius), and FI Investments.

After the bank decided to withdraw the OFS component, it had approached Sebi seeking an exemption from refiling the offer documents that did not reflect the exclusion of the OFS, which was granted by the market regulator.

The investors challenged this decision saying that the shareholders’ resolution only allowed the bank to alter the size of the OFS and not withdraw it.

However, this appeal was dismissed by the SAT.

A detailed order from the tribunal is awaited.

During the hearing, the senior counsel for one of the petitioners said that shareholders’ permission was not taken for the removal of the OFS.

This was contested by the bank’s counsel, which claimed that shareholders have given them the right to modify the offer.

The private sector lender has fixed a price band of Rs 500-525 for the Rs 832 crore IPO.

It will open for subscription on September 5 and conclude on September 7.

The bidding for anchor investors will open on September 2. It will be a fresh issue of1.58 crore equity shares.