DSE suspends trading of Padma Oil
Thursday, 31 March 2011
FE Report
The country's prime bourse ---Dhaka Stock Exchange (DSE)---Wednesday suspended the share trading of Padma Oil, as the company breached securities laws by changing its dividend declaration, officials said. The move comes after an opinion of the Securities and Exchange Commission (SEC) that the DSE can suspend the trading of shares of the company, if the High Court's (HC) order on the company's dividend declaration is not contradictory with the securities laws. On March 21, the company's board of directors changed the previous dividend declaration (100 per cent cash), and recommended fifty per cent cash and fifty per cent stock dividends for the year ended on June 30, 2010. A news posted on DSE website said, "The Board of Directors of Padma Oil Company Ltd. have changed recommended dividend prior to holding AGM, which is a contravention of the SEC Notification." The SEC Notification said, "The decision about recommending or not recommending dividend and entitlement, if recommended, cannot be changed prior to holding of the annual general meeting." But Padma Oil changed its recommended declaration prior to holding AGM. In such a condition, the DSE thinks that the company's changed declaration can affect the market price of its shares.
The country's prime bourse ---Dhaka Stock Exchange (DSE)---Wednesday suspended the share trading of Padma Oil, as the company breached securities laws by changing its dividend declaration, officials said. The move comes after an opinion of the Securities and Exchange Commission (SEC) that the DSE can suspend the trading of shares of the company, if the High Court's (HC) order on the company's dividend declaration is not contradictory with the securities laws. On March 21, the company's board of directors changed the previous dividend declaration (100 per cent cash), and recommended fifty per cent cash and fifty per cent stock dividends for the year ended on June 30, 2010. A news posted on DSE website said, "The Board of Directors of Padma Oil Company Ltd. have changed recommended dividend prior to holding AGM, which is a contravention of the SEC Notification." The SEC Notification said, "The decision about recommending or not recommending dividend and entitlement, if recommended, cannot be changed prior to holding of the annual general meeting." But Padma Oil changed its recommended declaration prior to holding AGM. In such a condition, the DSE thinks that the company's changed declaration can affect the market price of its shares.