Richard Pieris Rights Issue deferred

The shareholders of Richard Pieris & Company decided not to go ahead with the proposed Rights Issue at an Extraordinary General Meeting held on October 2.

Richard Pieris announced a Rights Issue on August 8, 2007 in the proportion of two new shares for every nine shares held at a price of Rs. 35 per share to raise Rs. 997.5 million.

At the time of announcement the company’s shares were trading at Rs. 50 per share and the Rights were offered at a 30 per cent discount to market.

However since the announcement the company’s share price had fallen to Rs. 38 owing to the overall weakness of the Colombo Stock market.

At the meeting several shareholders pointed out that considering the current market price of the share, the proposed Rights price of Rs. 35 per share was unattractive for them to subscribe for the issue and requested the Board to consider deferring the issue.

Chairman Dr. Sena Yaddehige acknowledged the concerns expressed by the minority shareholders and indicated that the Board would go along with the decision of the shareholders.

Consequently a majority of the shareholders present at the meeting voted against the resolution for the Rights Issue.