Malwatte Valley revises Rights Issue after CSE imposes trading halt over listing rule violation

Malwatte Valley Plantations (MAL) yesterday announced a revised Rights Issue after the Colombo Stock Exchange directed a trading halt as the original move of the Company was non-compliant with listing rules.

Originally following the meeting of Board of Directors MAL announced a rights issue mixing voting and non-voting shares. The basis was for every 10 voting shares held, one voting share and three non-voting shares as well as for every 10 non-voting shares held one voting share and three non-voting shares will be offered at Rs. 6.75 for voting and Rs. 5.50 for non-voting share.

Consequently 24.759 million voting shares will be issued along with 74.277 million non-voting shares. The company’s current stated capital is Rs. 373 million. The original move was to raise Rs. 576 million.

In response the CSE yesterday said the announcement made by MAL with regard to the Rights Issue does not comply with Rule 5.1.1. c of the Section 5 of the CSE listing rules. This saw a trading halt imposed on MAL.

Thereafter MAL made an amended announcement with Rights offered on the basis of Voting shares – For every 10 Voting Shares held, 2 Voting Shares and 2 Non Voting Shares and Non Voting Shares – For every 10 Non Voting shares held, 2 Voting Shares and 2 Non Voting Shares. Price at which Rights are offered remain unchanged. Following the revision the amount raised will be Rs. 606.5 million. The proceeds of the issue are to be utilised for diversification into the leisure sector.