The market regulator, Securities and Exchange Board of India (SEBI) is scrutinising Crisil’s purchase of an 8.9% stake in rival credit rating firm CARE Ratings on June 29, after the latter complained the transaction was an attempt at a potential hostile takeover, a leading business daily reported today.
SEBI has sought clarifications from Crisil about its motive and questioned it whether the purchase represented a financial investment or had wider strategic implications such as a takeover.
“This is an investment. We are optimistic about the long-term growth prospects of the credit rating sector,” said Crisil, while there were no comments from Care Ratings.
The report also quoted a SEBI official stating that Care Ratings has made its representation to them on the same and the regulator will now scrutinise Crisil’s response.