Financial Times

E.B. Creasy says shareholders should not abuse AGMs
E.B. Creasy and Co. Ltd. has said that while shareholders have every right to speak at annual general meetings they should not abuse such opportunities by making wild and irresponsible allegations.

A statement issued by E.B. Creasy managing director S.D.R. Arudpragasam clarifies some of the issues raised in The Sunday Times FT lead story of December 4, 2005 headlined ‘E.B. Creasy AGM turns stormy’ but doesn’t deny accusations that the management threatened to eject certain shareholders who spoke at the meeting.

Referring to shareholder allegations of financial irregularities, Arudpragasam said company’s accounts “have been audited by a reputed firm of auditors and no mention has been made anywhere in the accounts regarding financial irregularities. “Where specific matters had to be mentioned these were mentioned either by way of notes or qualifications, as are required by the Auditing Standards,” he said.

“Merely because shareholders have the right to speak at AGMs such right should not be abused. Shareholders, whether foreign or local, have every right to raise questions at meetings of shareholders but such questions must not be preceded by wild and irresponsible allegations intended to disturb the meeting.”

Arudpragasam also said foreign shareholders are “most welcome to purchase shares and indeed it is the major shareholders of the company who sold part of their shares to Mr Al Nakib at the request of Mr Al Nakib’s brokers who contacted major shareholders directly.

“The major shareholders would not have sold the shares of the company to Mr Al Nakib if they had any problem about foreign shareholders.” Arudpragasam said the 4.5million shares of Lankem Ceylon Ltd. were disposed of on the occasion of a bonus issue and such disposal was referred to in the half yearly interim statements of the company issued to shareholders in 2004.

“Mr Al Nakib clearly has not read the company’s reports. If he did so he would not have wanted any further information. The company still retains a controlling interest in Lankem. Quite apart from the 4.5 million shares in question, the company has, over a period of time, subsequently sold a further substantial quantity of Lankem shares in the market.”

Arudpragasam also rejected allegations by Al Nakib on monies lent by E.B. Creasy to group companies which he states amounts to contempt of court.
“Mr Al Nakib must understand that the directors of the company are not rash or reckless to act in contempt of a Court order. The Directors wish to state that they have not acted in violation of the Court order.”

Referring to Al Nakib’s threats to take the company to court, Arudpragasam said the board will deal with the action when he files it. “If Mr Al Nakib is unable to understand financial statements, he must seek the assistance of his brokers or other financial advisors. He should endeavour to find out about companies prior to making an investment in them and not after.”

“It is not possible to allow any single shareholder whether he be a Sri Lankan or a foreign shareholder to attend AGMs and disturb such meetings by raising questions which he could have raised at any time and obtained information from company officials.

“Mr Al Nakib was not refused any information. He was only told that dates and figures were not immediately available and that he could always talk to the company officials after the meeting and obtain whatever information he required.”

Shareholder solidarity
M. Mohideen, a minority shareholder of E.B. Creasy and Co. Ltd. has clarified that he was threatened with eviction at the firm’s AGM after he stood up to defend another shareholder, Talib Al Nakib, who was treated in a rude manner and indirectly threatened with eviction.

Al Nakib said that the chairman had said that “we don’t want troublesome foreigners in the meeting – in other words asking me to get out”. Mohideen said he then intervened to defend Al Nakib and was threatened with ejection.

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