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Al-Noor Modaraba returns 0.6m shares purchased from its subsidiary

RECORDER REPORT

ISLAMABAD: The management of First Al-Noor Modaraba has informed the SECP that in the interest of good corporate governance and cooperation, the management has returned 600,000 shares purchased from its subsidiary Shahmurad Sugar Mill.

Sources stated that a formal letter has been sent by the First Al-Noor Modaraba announcing the compliance of the order of the Registrar.

In November the Commission had asked the Modaraba company to disinvest the 600,000 shares it purchased from associated firm at manipulated price. The manipulation of share price was complained by the Karachi Stock exchange following which SECP issued notice to the company.

However, on the publication of the report in Business Recorder on November 3, the company sent a "contradiction" saying that there was no truth in the report in as much as the decision has yet to be taken by Registrar on the alleged complaint."

Last month, the Commission appointed a chartered accountants firm to investigate and report about the alleged manipulation within a month.

The KSE had complained that the price of share of Shah Murad Sugar Mills on January 8, 1998, was Rs 13 which was manipulated to Rs 17.50 on January 19. On January 22, the Modaraba company purchased 600,000 shares at Rs 19.25 per share. It said that for two weeks prior to January 22, only 500 shares were transacted and there was a rise of 50 paisa per share till January 19 when its price was Rs 17.50. During preliminary inquiry, the Commission found that the shares were purchased from the family members of the associated company. The chief executive of Shahmurad Sugar Mills was also the chief executive of the Modaraba company.

Sources added that the investigation of the alleged manipulation is continuing.