BSEC bars KPCL share transfers, sales by sponsors, directors

Bangladesh Securities and Exchange Commission on Tuesday suspended any sales and transfer of Khulna Power Company Limited’s shares by the company’s sponsors and directors until further order as they continued selling shares of the company hiding company’s price sensitive information.
The decision came at a commission meeting, presided over by its chairman M Khairul Hossain, a BSEC press release said.
The IPP contract between KPCL and Bangladesh Power Development Board named KPCL 110MW Barge Mounted Power Plant was expired on October 11, 2018 and BPDB asked KPCL to keep the power plant closed on the same day.
But, KPCL did not disclose the information despite having price sensitivity.
The sponsors and directors of the company continued selling shares of the company without disclosing the information.
As per the BSEC decision, all sponsor-directors and 10-per cent shareholders of the company have been barred to sell, transfer or pledge shares of KPCL until the regulator’s further direction.
BSEC will issue a directive in this regard soon.
The commission also formed an investigation committee to look into the matter.
According to DSE-disseminated news, KPCL said that the PPA of subject power plant was expired on October 12, 2018 and BPDB had informed them that the resumption of the said pant would be informed in due course; accordingly they were having discussion with BPDB.
Furthermore, it was all through known that the tenure of 1st amended PPA of this Plant would expire on October 12, 2018 which was clearly mentioned in the audited financial statements 2016-2017 notes 1.1 under company profile, it said.
BSEC at the meeting also fined managing director and all directors except independent directors of Central Pharmaceuticals Limited Tk 4 lakh each as the company violated securities rules.
Dhaka Stock Exchange investigation found that the auditor of the company had provided qualified opinion for the company’s financial year ending June 30, 2017, but CPCL provided unqualified audit opinion to BSEC, DSE and investors, breaching securities rules.
The auditor mentioned that the company did not keep provision against bad loans and interests for short-term loans, and did not separate long-term loans’ current portion and long-term portion. It also did not adjust advanced tax and due tax according to the financial statements.
The commission also directed that the shareholder-directors of the company cannot get any dividends, gratuity and others benefits until the company fixed the violations.
The regulator at the meeting also decided to punish Indicate Securities and Consultant Limited as the brokerage house failed to provide annual financial reports ending on June 30, 2017 on due time.
The regulator has barred the directors of the company from getting dividends, gratuity and from the proceeds of share sales to a Chinese consortium.
The company cannot withdraw or distribute funds from reserve and retained earnings other than administration expenses.
Source: http://www.newagebd.net

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