Sri Lanka Stock Picks

Sri Lanka stock picks site has been developed to give first hand information with regard to share trading opportunities available for investors who do not like go through lengthy research reports, calculations,etc but to have a clear idea about stocks that have future up side potential.Our service is just not for day traders but for the investors who wish to see their money growing in the long run.Our main objective is to provide information relating to trading under one roof.

Saturday, May 14, 2011

SEC likely to probe GREG’s warrants extension

By Jithendra Antonio

A top official from Sri Lanka’s market watchdog said that Securities and Exchange Commission (SEC) is probing the recent move by European Hedge Fund Lionhart Investment’s public announcement (a notice) about the extension of exercisable date of Environmental Resources Investment Ltd (GREG) 2011 warrants, which the Colombo Stock exchange was not officially informed of.

At the verge of the exercise date deadline of Environmental Resources Investment PLC’s 2011 Warrants (GREG.W0001) on May 13, major shareholder European Hedge Fund Lionhart Investment Ltd in a paper advertisement said it has resolved to extend the exercisable and expiry dates of the warrants.

When Mirror Business inquired whether the announcement by Lionhart falls within the purview of CSE rules and regulations, the SEC official said the Colombo Stock Exchange should look in to the matter immediately.

In the statement, Lionhart Investment said that the exercisable date and expiry date of 104.31 million 2011 warrants that were issued pursuant to the resolution passed at the EGM held on 23 April 2009, should commence on 1 November 2011 and expire at 4pm on 21 December 2011.

“Cut-off date in respect of the said 2011 warrants shall mean 1 November 2011 and the expiration date of the said 2011 warrants shall mean 4pm 21 December 2011.” The warrants were originally scheduled to expire on 3 June 2011.

The statement by Lionhart further stressed that CSE shall be notified of the aforementioned variations of the period of exercise of 2011 warrants.

A CSE official was of the view that though a major shareholder of a company can advertise; it should be notified to the Stock Exchange by the company, in this case the Environmental Resources Investment PLC (GREG).

As to date Lionhart Investment Ltd holds 267.97 million (85%) ordinary voting shares of Environmental Resources Investment PLC (GREG), and has 98.33 million of GREG 2011 warrants which constitute more than three fourths of the value of the said 2011 warrants.

On the contrary, market sources are of the view that Lionhart Investment is in a move to reduce its exposure to GREG warrants, whenever the warrants are being exercised.

“What Lionhart does is that they divest warrants to existing other warrant holders, as they have the ability to apply for more warrants during the exercisable time and get capital gains by selling at the normal GREG share price,” an analyst pointed out.

source - www.dailymirror.lk