SEC directs Kalpitiya to postpone EGM, unhappy with resort development proposals
View(s):Kalpitiya Beach Resort has been requested by the Securities and Exchange Commission (SEC) to postpone its scheduled extraordinary general meeting (EGM) in May by another month, saying it (company) has to give precise clarification on how to protect the minority shareholder interests prejudiced by the delays in building their resort, Citrus Kalpitiya, a SEC announcement said on Tuesday.
It added that the letter was sent to the company on Monday, after the SEC had perused their circular issued to the shareholders and the SEC was of the opinion that the alternate courses of action stated in the circular to the shareholders lacked specific direction pertaining to providing adequate recourse to the minority shareholders in respect of their investment.
“This was to enable the company to come up with a precise direction on the future course of action on how the company proposes to safeguard the minority shareholder interests prejudiced by the delays caused in constructing the resort hotel, Citrus Kalpitiya,” the SEC said in a media release on Tuesday.
On March 20th, the SEC ordered Kalpitiya Beach Resort to call an EGM for not complying with construction work stated in its prospectus after it had raised some four years ago Rs. 283.5 million from an initial public offering saying this cash will be utilised partly to finance a construction of a resort hotel in Kalpitiya within the stipulated period of two to two and a half years.
The SEC has asked the company that in the event they are unable to rectify the issues in respect of the construction of the hotel, it is required to propose a viable alternate scheme to redress the shareholders who have been prejudiced by the failure of the company to carry out its objectives as stated in the prospectus.