June 28, 2016 (LBO) – The minimum public holding of Sri Lanka’s Lion Brewery has fallen below the stipulated float making it obligatory for the company to make an announcement.
As per the minimum public holding rules, there are two ways to get listed on the main board of the Colombo Stock Exchange.
One option is that a listed entity on the main board should maintain a minimum public holding of 20 percent of its total listed ordinary voting shares in the hands of a minimum of 750 public shareholders.
Second option is that a market capitalization of 5 billion rupees of its public holding in the hands of a minimum of 500 public shareholders while maintaining a minimum public holding of 10 percent.
On 17th May 2016, the Public Holding of Lion Brewery which falls under the above second option has fallen below the required market capitalization of 5 billion rupees.
The company’s market capitalization as at 24th June 2016 was 4.39 billion rupees and its public holding percentage was 13.92 percent represented by 1,174 public shareholders.
Issuing a non-compliance announcement the company said the number of shares held in the hands of the public shareholders as at 24th June 2016 was 11,134,825 ordinary shares.
Sri Lanka’s securities regulator however is reconsidering the minimum public float rule as the intention of introducing such rule was not met.
Few companies have already de-listed and several others have transferred to the secondary Diri Savi Board following the introduction of new rules.