Security and Exchange Board of India ( Sebi) is in the process of
finalising a frame work for the co-investment fund and the
announcement could be a part of the budget speech.
According to a source, “Sebi has sent across the final budget proposal for a co-investment fund that is going to augment the capital requirement for SME”.
Co-investment funds are typically made to meet additional capital needs and adds to a main financial sponsor. Following recent measures such as separate SME exchanges and the institutional trading platform (ITP), it is proposed to set up a SME co-investment fund.
A person privy to the development said that the Sebi framework may allow the co-investment fund to invest in an SME during its initial public offer (IOP) or a company listing directly through the ITP route. ITP is the mechanism of allowing an SME to list directly without an IPO.
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