04-20-2010, 01:31 AM
Dear Star
The student who starts learning CO84 from the very first day comes to know what private limited company is and whether or not its shares can be offered to general public. There is nothing new to be clarified.
That's why it has been pointed out that term COMPANY used in Rule 9 is quite vague and there is a need to get clarification in this regard. Certainly the term COMPANY includes the PRIVATE LIMITED COMPANIES (and even Guarantee companies who do not have share capital at all); and of course PRIVATE LIMITED COMPANIES cannot offer their shares to public unless converted to public limited.
So, in my view COMPANY has to be clarified although I know it is not applicable to private limited companies. However, there are two categories in public limited as well which cannot be ignored.
Regardless of above, I do believe that this rule is for all public companies including unlisted ones. In a recent case this has been done while listing of a power sector company (previously unlisted one) at KSE.
I am only pointing out an ambiguity in law and also sharing my idea that the purpose of such transaction can be met without going for such an effort.
.................................
As far as affect on market capitalization is concerned, normally the customers are pre-identified where such a huge holding is being sold. In such cases, since rate is decided after proper due diligence and advices, the market rates normally increase because of market sentiments witnessing hot deals.
Further, if this is not a case, even then a well planned sell out strategy focussing the market demand of the scrip can preserve the market value and can even enhance it. The necessity is only to manage the inside information and keep in focus the demand/supply ratio.
Of course we have discussed that such sales must be made in trenches and over a specific period so that no legal issue arises.
Regards,
The student who starts learning CO84 from the very first day comes to know what private limited company is and whether or not its shares can be offered to general public. There is nothing new to be clarified.
That's why it has been pointed out that term COMPANY used in Rule 9 is quite vague and there is a need to get clarification in this regard. Certainly the term COMPANY includes the PRIVATE LIMITED COMPANIES (and even Guarantee companies who do not have share capital at all); and of course PRIVATE LIMITED COMPANIES cannot offer their shares to public unless converted to public limited.
So, in my view COMPANY has to be clarified although I know it is not applicable to private limited companies. However, there are two categories in public limited as well which cannot be ignored.
Regardless of above, I do believe that this rule is for all public companies including unlisted ones. In a recent case this has been done while listing of a power sector company (previously unlisted one) at KSE.
I am only pointing out an ambiguity in law and also sharing my idea that the purpose of such transaction can be met without going for such an effort.
.................................
As far as affect on market capitalization is concerned, normally the customers are pre-identified where such a huge holding is being sold. In such cases, since rate is decided after proper due diligence and advices, the market rates normally increase because of market sentiments witnessing hot deals.
Further, if this is not a case, even then a well planned sell out strategy focussing the market demand of the scrip can preserve the market value and can even enhance it. The necessity is only to manage the inside information and keep in focus the demand/supply ratio.
Of course we have discussed that such sales must be made in trenches and over a specific period so that no legal issue arises.
Regards,
