The Captains’ family (Sohli and Rusi) and related parties, the largest shareholders of John Keells Holding (JKH) Plc with 18 %, will not dispose their shares anymore after their JKH selling spree during the past few months, a source close to the family said.
"Rusi Captain and connected parties had 23 %, but sold about 5 % over the past few months. They will not be selling anymore in present market conditions," the source told The Sunday Times FT.
He said the Captains’ were not in the 'margins' with the banks in that (since they had borrowed money to buy the rights) they had to repay the banks by selling some of their shares. "In December they sold approximately one to two million shares," he said, adding that some shares from the 5 % the Captains’ sold to raise money to repay the banks were sold at a loss.
When asked why the family is holding onto the JKH shares which sharply dropped during last year, he said that they 'like' the company. "They are most happy about the company and its management." When asked whether the rights were announced by the company to stop the Captains’ from increasing their shareholding, he said, it would be true, but also the timing was right (for the company). "When a share hits a high, a rights issue is announced. That is what they did. Morally it may be wrong, but it is not illegal," he added.
The company offered a rights issue of 1-for-5 at Rs. 140 each, issuing 92 million shares. However the demand was for 120 million shares. Stock market analysts said most of the Rs.13 billion JKH raised in 2007 through the rights issue was not invested in new projects -- as communicated by the company -- but secured in interest earning instruments such as treasury bills. Interest income for the nine months in 2008 was Rs.168 million. |
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