Sri Lanka’s SEC directs Kalpitiya Beach Resort to call an EGM

Mar 20, 2015 (LBO) – Sri Lanka’s Securities and Exchange Commission (SEC) has directed Kalpitiya Beach Resort to call an extraordinary general meeting for not complying with a construction work stated in the prospectus.

In 2011, Kalpitiya Beach Resort has raised 283.5 million rupees from an initial public offering stating that the funds will be utilized partly to finance a construction of a resort hotel in Kalpitiya.

Even though the company has vowed to start commercial operations of the completed hotel in early this year, the SEC at a meeting held on 10th March has expressed ‘grave concerns’ for not constructing a hotel within the stipulated time.

“The market disclosure made by your company and the reasons given for the delay no longer justifies prolonging the construction any further.” the SEC said in a directive issued Friday.

The securities watch dog has directed the company to call an EGM before 10th May 2015 to apprise the shareholders of the true position of the company and to pass a resolution on an alternative course of action.

The directive has also insisted the company to prepare a report with adequate information to enable shareholders to make an informed decision.