Capital market regulator SEC is holding back approval of Nawaloka Hospital IPO over the company decision to pre-allocate two thirds of the issue.
SEC Director General told LBR they are talking to the company about its intention to pre-place Rs. 200 million worth of shares from its planned Rs. 300 million IPO.rn
rnSEC Director General said that securities legislation requires the company to offer all shares to the public without any private placement. rn
rnIf Nawaloka does go for a private placement then it cannot go for an IPO till one year after the issue according to him. rn
rnThe pre-allocation shares do not need to be underwritten. rn
rnManagers to the issue the Merchant Bank of Sri Lanka (MBSL) were only planning to have Rs. 100 million of the issue underwritten.rn
rnHowever, the IPO can go ahead as planned if the SEC gives it special approval, which the securities watchdog is not keen on granting.rn
rnOfficials said MBSL, Nawaloka Hospitals and the SEC are in talks to resolve the issu