Kathmandu, Vaisakh 5
Guardian Micro Life Insurance Company’s special general meeting has been postponed following directives from the Nepal Insurance Authority. The company had called the meeting on Vaisakh 5 to approve a proposal for issuing a 100% rights share. However, the Authority instructed the company to halt the meeting, citing that the process had been advanced without prior approval.
On Chaitra 18, the Board of Directors had decided to issue rights shares and called for the special general meeting. Accordingly, the company had also declared the book closure date on Chaitra 28.
The Authority demanded clarification from the company, pointing out the violation of the provision that prior approval is mandatory before issuing rights shares. Finding the company’s response unsatisfactory, the Authority formally directed the postponement of the meeting on Tuesday.
Rights Share Issuance Plan
Guardian Micro Life currently has a paid-up capital of NPR 75 crore. The company planned to increase its capital to NPR 150 crore through the rights share issuance. Last Poush, the company issued an IPO of 2.25 million shares worth NPR 22.5 crore, which raised the capital to NPR 75 crore.
Allegations of Market Manipulation
The company’s share price started trading on Magh 27 and peaked at NPR 2,778 by Vaisakh 2. During this period, following the announcement of the rights issue and the price fluctuations, concerns have been raised among investors about possible information leaks and market manipulation.
Conclusion
The intervention by the Authority has introduced uncertainty into Guardian Micro Life’s rights share issuance process. Investors are now closely watching the company’s next steps and how it coordinates with the regulatory body going forward.
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