A public announcement of an open offer is rarely the end of the story. The moment an acquirer signals intent to take control of a listed target, the door opens for rivals to mount their own bid. Regulation 20 of the SEBI (Substantial Acquisition of Shares and Takeovers) Regulations, 2011 governs this contest, fixing a tight fifteen-working-day window, a minimum-size threshold, synchronised timelines and the right to keep revising price. It is the clause that turns a quiet acquisition into a takeover battle — as the markets saw in the fight for Mangalore Chemicals and, more recently, in the Religare saga. This chapter unpacks how a competing offer is launched, how it interacts with the first offer, and where the 2011 regime broke decisively from the old 1997 Code.
What is a competing offer?
A competing offer is an open offer made by a person other than the acquirer who first announced an open offer, in respect of the very same target company. Once the first acquirer makes its public announcement and follows up with the detailed public statement (DPS), Regulation 20(1) entitles any other person to step in with a rival open offer. The Code does not call this person a “competing acquirer” loosely — the offer that triggers the contest is technically still an open offer in its own right, attracting the full discipline of the Code, but it is layered on top of an existing one for the same shares.
The purpose is squarely investor-protective. Public shareholders of a target should not be locked into the price and terms of whichever bidder happened to move first. By permitting a rival to enter and by forcing the two offers onto a common timetable, Regulation 20 manufactures price competition that flows back to the ordinary shareholder. The mechanics build on the general trigger for an open offer — a competing offer is simply a second triggering event running in parallel with the first.
It is worth being precise about the vocabulary. The Code uses “public announcement” for the short initial intimation an acquirer must make the moment it agrees to acquire shares, voting rights or control that crosses an open-offer threshold; the “detailed public statement” is the fuller statement, published in newspapers within a few working days thereafter, that sets out the offer price, size, identity of the acquirer and the schedule. Regulation 20 deliberately keys the competing-offer window to the DPS rather than the bare public announcement, because the DPS is the document from which a potential rival can actually assess whether a counter-bid is worth mounting. A competing offer therefore presupposes that the first acquirer has progressed at least to the DPS stage; there is no contest to join until the first bidder has shown its hand in detail.
The fifteen-working-day window: Regulation 20(1)
The single most examinable rule is the timing. Under Regulation 20(1), a competing offer must be made within fifteen working days of the date of the detailed public statement made by the acquirer who issued the first public announcement. The clock therefore runs not from the original public announcement but from the DPS — a subtle distinction that aspirants routinely get wrong.
The window is hard-edged. The general scheme of the Code is that, after those fifteen working days have elapsed, no fresh open offer (or transaction that would itself trigger one) may be launched for the same target until the existing offer period expires. The contest, in other words, is open for a fortnight and then sealed. This is what gives the first acquirer certainty: it knows that after the fifteenth working day no surprise rival can ambush its offer, and it can plan its acquisition financing accordingly.
The rigidity of the deadline was on full display in 2025 in the fight for Religare Enterprises. US-based investor Digvijay (Danny) Gaekwad sought SEBI's permission to make a competing open offer at Rs 275 per share against the Burman group's offer of Rs 235, but his formal application reached SEBI on 1 February 2025, outside the Regulation 20(1) window. SEBI rejected the plea, noting among other things that he had not deposited the Rs 600 crore the Supreme Court had directed and describing the attempt as aimed at hindering the existing open offer rather than as a bona fide competing bid. The episode is a textbook reminder that the fifteen-working-day clock is jurisdictional, not directory.
How large must a competing offer be? Regulation 20(2)
A competing offer cannot be a token bid. Regulation 20(2) requires that the offer be for at least the number of shares which, taken together with the shares already held by the competing acquirer and persons acting in concert, equals the aggregate of the shareholding of the first acquirer plus the shares it has offered to acquire under its open offer. In short, the rival must be willing to end up at least as large as the first bidder would be if its offer fully succeeds.
The logic is to ensure parity of seriousness. A competing offer is meant to be a genuine alternative path to control, not a spoiler designed merely to inflate the first acquirer's costs. By pegging the minimum size to the first acquirer's combined holding-plus-offer, the Code guarantees that a successful competing offer can deliver the rival a comparable control position. The size threshold dovetails with the broader concepts of the 25% substantial-acquisition threshold and the role of persons acting in concert, whose holdings are aggregated for this computation.
A worked illustration helps. Suppose the first acquirer already holds 30% of the target and makes an open offer for a further 26%, so that if its offer succeeds it would reach 56%. A competing acquirer holding nothing must then offer for at least 56% (or, if it already holds, say, 10%, for at least 46% so that its total reaches 56%). The threshold floats with the first acquirer's position; it is not a fixed 26%. This is one of the points candidates most often misstate — the minimum competing-offer size is referenced to the first acquirer's aggregate resulting stake, not merely to the size of the first acquirer's open offer. The drafting deliberately forces the rival to commit to a stake that could realistically wrest control, which is why a small “nuisance” bid cannot qualify as a competing offer at all.
A competing offer is not a voluntary offer: Regulation 20(3)
Regulation 20(3) clarifies that a competing offer made under Regulation 20 is not a voluntary open offer under Regulation 6. This matters because voluntary offers carry their own eligibility conditions and restrictions (for instance, on acquirers who have themselves bought shares in the preceding fifty-two weeks). A competing offer is treated as a free-standing open offer attracting the full procedural machinery of the Code — public announcement, DPS, letter of offer, escrow, pricing under Regulation 8 and so on — but it is exempt from the special voluntary-offer regime precisely because it is a reactive bid, launched in response to another's announcement rather than on the acquirer's own initiative.
The practical upshot is that all the general obligations of an acquirer apply equally to the competing acquirer. There is no “lite” version of an open offer simply because a contest is on; every bidder in the ring must satisfy the same disclosure, pricing and settlement norms that any open offer demands. The competing acquirer must independently make its own public announcement and DPS, appoint a merchant banker, create the escrow, and price its offer in conformity with the minimum-price rules — it cannot piggyback on the first acquirer's filings.
Treating the competing offer as a non-voluntary offer also has a subtle pricing implication. A voluntary open offer under Regulation 6 is hedged with conditions designed to stop an acquirer who has been actively buying from using a small voluntary offer to consolidate cheaply. Because a competing offer is reactive, those particular fetters are inapt and are switched off by Regulation 20(3). But the minimum-pricing discipline of Regulation 8 is not relaxed: the competing acquirer's price floor is computed on the same basis as any other open offer, so the only way it can win the contest is by bidding genuinely higher, never by exploiting a procedural shortcut.
Conditional competing offers: Regulation 20(6)
Open offers can sometimes be made conditional upon a minimum level of acceptance, allowing the acquirer to walk away if too few shareholders tender. Regulation 19 of the Code governs such conditional offers. Where a contest develops, Regulation 20(6) aligns the two bids: a competing offer can be made conditional as to a minimum level of acceptance only if the first offer was itself a conditional offer. If the first acquirer made an unconditional offer, the competing acquirer must also bid unconditionally.
This symmetry prevents a rival from gaining an unfair structural advantage. A bidder who could hedge its commitment with an acceptance condition, while the incumbent bid stands unconditional, would be making a materially less risky offer. By tying the availability of conditionality to the character of the first offer, Regulation 20(6) keeps the playing field level on the dimension that matters most to a tendering shareholder — certainty that the offer will actually close.
Synchronised timelines and a common tendering period: Regulation 20(8)
Perhaps the most elegant feature of the 2011 regime is the synchronisation rule. Regulation 20(8) provides that the schedule of activities and the tendering period for all the competing offers shall be carried out with identical timelines, and that the last date for tendering shares in acceptance of every competing offer shall stand revised to the last date for tendering shares in acceptance of the competing offer last made.
The effect is that, however many bids enter the contest and whenever they enter within the fifteen-working-day window, they all converge on a single tendering period that closes on the same day — the date governed by the latest competing offer. A shareholder is therefore never forced to choose blind: by the time tendering opens, every offer on the table is visible, with its final price, and the shareholder can pick the best one. This common-tendering-window architecture replaced the messier sequential-bidding model of the 1997 Code and is the structural heart of how the Takeover Regulations engineer genuine competition.
Two consequences follow that are easy to overlook. First, the first acquirer cannot complete its offer ahead of the rivals and thereby foreclose the contest; its own tendering date is pushed back to align with the offer last made. The incumbent loses the timing advantage of having moved first, and is instead drawn into a level auction. Second, because the timelines are identical for all offers, the procedural steps — despatch of the letter of offer, opening and closing of the tendering period, payment of consideration — all march in lock-step, simplifying compliance for the registrars and the stock exchanges and removing the scope for tactical games around sequencing. The synchronisation rule is therefore not a mere administrative convenience; it is the mechanism that prevents the first-mover from converting a head start into a structural lock on the target.
Revising the offer upward: Regulation 20(9) and Regulation 18(4)
A bidding war is, at bottom, a price contest, and the Code keeps that contest alive almost to the last moment. Regulation 20(9) entitles the first acquirer to revise the terms of its open offer where the terms of a competing offer are more favourable, so that the incumbent is not left stranded with an inferior bid. More generally, acquirers making competing offers are entitled to make upward revisions of the offer price at any time up to three working days prior to the commencement of the tendering period, mirroring the general revision rule in Regulation 18(4).
When an acquirer revises, Regulation 18 requires it to make corresponding adjustments to the escrow, publish a public announcement of the revision in the same newspapers in which the DPS appeared, and simultaneously inform SEBI, the stock exchanges and the target company. Only upward revisions are permitted; an acquirer can never reduce its offer price once announced. Because the common tendering period closes on a single date for all bids, the “three working days before tendering” cut-off applies uniformly, giving each side a final opportunity to better the other before the shareholders decide.
The interplay between the fifteen-working-day entry window and the three-working-day revision cut-off is what keeps a contest dynamic without making it endless. New bidders can only enter within the first fifteen working days from the DPS; but once in, every bidder — first acquirer and competing acquirers alike — may keep sweetening price right up to three working days before the synchronised tendering period opens. The result is a defined auction: entry is capped early so the field is known, while price competition among the known bidders is allowed to run almost to the wire. This is a deliberate design choice that balances the first acquirer's need for certainty against the shareholders' interest in extracting the highest possible exit price, and it is the precise feature that the sequential 1997 model lacked.
Restrictions on acquisitions during the contest
While a contest is live, the Code restricts opportunistic share-buying that would distort it. Once the fifteen-working-day window has closed, no person may make a fresh public announcement of an open offer, or enter into any transaction that would itself attract the obligation to make an open offer, for the same target until the offer period expires. The contest is thus frozen to the bidders who entered in time.
There are further guardrails tied to conditional offers. Where an offer is made conditional upon a minimum level of acceptance, the acquirer and persons acting in concert are barred from acquiring shares in the target during the offer period otherwise than through the open offer itself — they cannot quietly mop up shares in the market while holding out the threat of walking away from a conditional bid. These restraints reinforce the principle that, once a competing-offer contest begins, control of the target must be decided transparently through the open-offer process and not through side-acquisitions.
The target board in a contest: even-handed cooperation
A competing offer puts the target's board of directors in a delicate position, and the Code constrains its conduct. Under the general obligations governing the target board during an offer period, the board must ensure the business is conducted in the ordinary course consistent with past practice and must not, without shareholder approval, take frustrating action such as alienating material assets or issuing fresh securities that would defeat an offer.
Crucially for contests, the board must act even-handedly between rival bidders. Any information and cooperation furnished by the target to one acquirer must be made available to all acquirers making competing offers. The board cannot play favourites by feeding due-diligence material to a preferred suitor while starving a rival — a rule that protects the integrity of the competition and, ultimately, the shareholders' ability to extract the best price. This even-handedness obligation is one of the practical levers that distinguishes a genuine auction from a stitched-up sale.
How Regulation 20 differs from the 1997 Code
The competing-offer architecture changed materially when the 2011 Code replaced the 1997 Regulations, which stood repealed from 22 October 2011. Under the old Regulation 25 of the SAST Regulations, 1997, any person other than the first acquirer who wished to bid had to make a public announcement of a competitive bid within 21 days of the public announcement of the first offer, and an offer so made was deemed a competitive bid. The 1997 Code therefore measured the window from the public announcement and set it at 21 calendar days.
The 2011 Code, drafted on the recommendations of the Takeover Regulations Advisory Committee chaired by the late C. Achuthan, made three decisive shifts. First, it re-anchored the window to fifteen working days from the DPS rather than 21 days from the public announcement, tightening and clarifying the period. Second, it introduced the common tendering-period mechanism of Regulation 20(8), so that all bids close together rather than in a confusing sequence. Third, it tied the conditionality of a competing offer to that of the first offer under Regulation 20(6). For the fuller story of how the framework was rewritten, see the evolution from the 1997 Regulations.
Case study: the battle for Mangalore Chemicals
The fight for Mangalore Chemicals and Fertilizers Limited (MCFL) in 2014 remains the most vivid Indian illustration of a competing-offer contest under the 2011 Code. Deepak Fertilisers and Petrochemicals Corporation crossed the substantial-acquisition threshold and, in April 2014, announced an open offer for 26% of MCFL at Rs 61.75 per share. The incumbent promoter group, led by Saroj Poddar of the Zuari group (alongside the Vijay Mallya stake), responded, setting off a months-long tug-of-war for control of the New Mangalore fertiliser company.
The contest played out exactly as Regulation 20 contemplates: rival bids and successive upward revisions. Deepak Fertilisers ultimately revised its open offer price sharply upward to Rs 93.60 per share, while the Zuari-led combine revised its competing bid in steps from the high sixties towards the eighties. The episode demonstrated how the synchronised-timeline and upward-revision rules convert a control fight into a series of escalating bids that benefit tendering shareholders, and how a first acquirer can be outlasted in a contest it began — Deepak Fertilisers eventually exited, selling its MCFL stake to the Zuari camp.
For the student, MCFL is valuable precisely because it shows the regulation working as designed rather than breaking down in litigation. The first mover (Deepak) did not enjoy any right of first refusal that would let it simply match a higher rival bid at the last moment and snap up the shares; it had to keep raising its own price on the common timetable, and when the economics no longer worked it walked away. The promoter-aligned camp, treated as a competing acquirer rather than as a privileged insider, had to play by the same Regulation 20 rules as any outsider. The shareholders, meanwhile, watched the offered price climb steeply from the low sixties — the clearest possible demonstration that the competing-offer machinery exists to transfer value to public shareholders, not to entrench whoever announced first.
How Regulation 20 fits the wider Code
Regulation 20 does not operate in isolation. The competing offer must be triggered by an acquisition that itself crosses an offer-triggering threshold, so it sits downstream of the rules on the 25% threshold, creeping acquisition and indirect acquisition. Pricing of a competing offer is determined under Regulation 8 like any open offer; the procedural steps — public announcement, DPS, letter of offer, escrow and payment — follow the same Chapter III machinery.
Certain situations bar a competing offer altogether. Where the first open offer arises out of a disinvestment, or is the product of a SEBI relaxation under the Code, a competing offer is not permitted, because those processes have their own state-driven or exemption-specific logic. A fugitive economic offender is likewise disqualified from making a competing offer. For the foundational concepts that feed these rules, the SEBI Takeover Code hub ties the chapters together.
Exam pointers and common traps
For judiciary and CLAT-PG candidates, a handful of precise points carry disproportionate marks. The competing-offer window is fifteen working days from the DPS — not from the public announcement, and not 21 days (that was the 1997 position). A competing offer is not a voluntary offer under Regulation 6. Its size must be at least equal to the first acquirer's holding plus the shares it offered to acquire. A competing offer can be conditional only if the first offer was conditional. All bids share a single tendering period closing on the date set by the offer last made.
The classic trap is to assume the 2011 Code retained any “right of first refusal” or sequential-bidding feature for the first acquirer; it did not. The incumbent's protection lies only in its right to revise upward up to three working days before tendering, on the same common timetable as everyone else. Pair these rules with the open-offer trigger and you have the complete picture of how a takeover contest is regulated in India.
Frequently asked questions
Within how many days must a competing offer be made under the SEBI Takeover Code?
A competing offer must be made within fifteen working days of the date of the detailed public statement (DPS) issued by the acquirer who made the first public announcement, under Regulation 20(1). The clock runs from the DPS, not from the public announcement, and the window is strictly enforced — as SEBI confirmed in 2025 when it rejected Danny Gaekwad's belated competing-offer plea for Religare Enterprises.
How large must a competing offer be?
Under Regulation 20(2), the competing offer must be for at least the number of shares which, together with the shares already held by the competing acquirer and persons acting in concert, equals the aggregate of the first acquirer's shareholding plus the shares it has offered to acquire. This ensures the rival can attain a control position comparable to the first bidder's.
Is a competing offer treated as a voluntary open offer?
No. Regulation 20(3) expressly provides that a competing offer is not a voluntary open offer under Regulation 6. It is a free-standing open offer attracting the full Chapter III machinery — public announcement, DPS, letter of offer, escrow and Regulation 8 pricing — but it is exempt from the special eligibility conditions that attach to voluntary offers.
Can a competing offer be made conditional on a minimum level of acceptance?
Only if the first offer was itself conditional. Regulation 20(6) permits a competing offer to be conditional as to a minimum level of acceptance solely where the first offer was a conditional offer under Regulation 19. If the first offer was unconditional, every competing offer must also be unconditional, preserving a level playing field on certainty of closing.
When do competing offers close, and can the price be revised?
Regulation 20(8) synchronises all competing offers onto identical timelines, with a single tendering period that closes on the last date applicable to the competing offer last made. Acquirers may make upward revisions of the offer price up to three working days before the tendering period commences (Regulation 20(9) read with Regulation 18(4)); downward revision is never permitted.
How does Regulation 20 of the 2011 Code differ from the 1997 Regulations?
Under Regulation 25 of the 1997 Regulations, a competitive bid had to be announced within 21 days of the public announcement of the first offer. The 2011 Code, framed on the Achuthan Committee's recommendations, shortened and re-anchored the window to fifteen working days from the DPS, introduced a common tendering period under Regulation 20(8), and tied a competing offer's conditionality to that of the first offer.