Shares in Everest Insurance, National Hydro suspendedThe Securities Board of Nepal (Sebon) has suspended trading in shares of Everest Insurance and National Hydropower.
The Securities Board of Nepal (Sebon) has suspended trading in shares of Everest Insurance and National Hydropower.
Everest Insurance has been put on the banned list for leaking sensitive information while National Hydropower is mired in a controversy regarding the legitimacy of its board of directors.
Sebon moved against Everest Insurance on suspicion of insider trading. The securities market regulator said it took action after receiving a number of complaints against the insurance company.
“We have received complaints against the insurer for leaking information about its rights and bonus shares before they were proposed at the company’s annual general meeting,” Sebon Spokesperson Niraj Giri said.
Sebon has written to the Nepal Stock Exchange to suspend trading in Everest Insurance shares. The company was to issue rights shares at the rate of 1:6 and 20 percent bonus shares to its shareholders.
A few days ago, the annual general meeting (AGM) of Everest Insurance proposed to issue bonus and rights shares. The price of its shares jumped from Rs2,400 to Rs2,600 per unit immediately after the announcement.
Sebon has accused the insurer of leaking information before the proposal was endorsed by its AGM.
“Based on complaints received against the company for leaking sensitive information, trading in its shares has been suspended until further notice,” Sebon said in a statement.
Likewise, the regulator has suspend trading in National Hydropower Company shares citing concern over an ongoing dispute between the company’s board of directors and the chief executive.
“The debate has raised questions on the validity of the company’s decisions that could adversely affect investors,” Giri said.
National Hydropower has recently suspended the company’s director Prakash Rajaure and executive director Ram Bahadur Tamang from their posts.
The company has a paid-up capital of Rs1.38 billion. The NB Group holds 1.6 million shares in the company.