Prime Finance complies with minimum public float rules
View(s):Prime Finance PLC is one of the few companies that have been actively seeking to increase its free float to meet the Colombo Stock Exchange’s (CSE) minimum free float requirements as per CSE Listing Rules.
Prime Finance’s share free float was only 6.9 per cent as at September this year.
However earlier this month three of its directors sold their shares and reduced their 92.7 per cent stake further since last quarter end. “We have now complied with the rules and Prime Finance’s minimum free float is now at 10 per cent,” Brahmanage Premalal, Chairman Prime Finance told the Business Times. The minimum public float rules stipulates the portion of shares of a listed firm that are in the hands of public investors as opposed to shares owned by a company’s institutional shareholders. The rationale for a minimum float is that a sizeable public float is a necessity to ensure a market that is fair, orderly and efficient, and introduction of a minimum public float as a continuous listing requirement is considered by all regulators in order to promote liquidity and ensure a better price discovery mechanism.
“Companies found non-compliant with the minimum public holding requirement as of July 1, 2017 would be transferred to the Watch List on July 1, 2018 unless due compliance is achieved prior to that date, while others which become non-compliant following July 1, 2017 would be transferred to the Watch List within six months of such non-compliance or on July 1, 2018, whichever date is late,” the Securities and Exchange Commission in a June announcement said.