SEC files criminal case against RN Spinning Mills
The Securities and Exchange Commission yesterday filed a criminal case against RN Spinning Mills on fraud charges, as the textile company provided fake documents to an inquiry panel of the regulator.
“The case was filed with Motijheel Police Station against the directors, managing director and company secretary of RN Spinning Mills,” said Saifur Rahman, executive director of the SEC.
The stockmarket regulator at a meeting on September 19 decided to file the case after its inquiry committee, which was formed to investigate the spinner's rights issue offer, found irregularities.
The company had offered one rights share for each existing share and took Tk 10 as a premium for each share in addition to Tk 10 face value.
In January, the regulator approved RN Spinning Mills' rights offer to issue 13.91 crore ordinary shares of Tk 20 each totalling Tk 278.28 crore.
The company eventually managed to sell Tk 180 crore worth of rights shares.
The SEC in June launched a probe into the delay in crediting the rights shares by the company.
RN Spinning undertook a rights issue this year which closed on March 13, but it did not credit the rights shares to the beneficiary owners' accounts within the stipulated time.
A rights issue is an issue of additional shares by a listed company to raise capital from existing shareholders. With the issued rights, the existing shareholders have the privilege to buy a specified number of new shares from the firm at a particular price within a specified time.