Legal moves halt govt share sales | The Daily Star
12:00 AM, May 12, 2008 / LAST MODIFIED: 12:00 AM, May 12, 2008

Legal moves halt govt share sales

The sale of more shares in four state-run enterprises has been halted by a legal action taken by company employees to prevent the government giving up majority control of the companies.
The government will lose majority control if more shares in Eastern Cables, Usmania Glass Sheet Factory, Atlas Bangladesh and National Tubes are offloaded in violation of the memoranda of articles of the companies, petitioners said.
A group of employees of Eastern Cables and Usmania Glass filed writ petitions after the government decided to offload 25 percent more shares in the four companies.
The stock market experts however came down heavily on the petitioners for creating barriers to share offloading process when the stock market faces supply of quality shares.
“While the government takes decision to offloading shares, a group of beneficiaries wants to create barriers by filing writ petitions. The government should identify who are creating the barriers and what is their motive,” said Abu Ahmed, professor of economics at Dhaka University.
There may be some barriers, but the government should remove all obstacles and implement its decision, he said.
In the memoranda of articles of the four companies it is said that the government must hold majority or 51 percent stakes.
As petitions were filed against the moves to offload shares in Eastern Cables and Usmania Glass, it will not be possible to continue the offloading process in the case of two other state-run companies -- Atlas Bangladesh and National Tubes, said an official of Investment Corporation of Bangladesh, which is responsible to manage the offloading of government stakes.
Now the government should amend the memoranda of articles of the state-run enterprises to clear obstacles to offloading process, the official said.
The government owns the 51 percent stakes in Eastern Cables, the largest wire manufacturing company, while the rest 49 percent are in the hands of public. It was listed on the stock exchange in 1986.
In Atlas Bangladesh, the government has 51 percent shares, while some institutions own 12 percent and public shareholders own 37 percent stakes. The state-run motorcycle assembling company was listed on the stock exchange in 1988.
The government owns the 53 percent stakes in National Tubes, a gas line pipe producing company, while 16 percent shares are in hands of institutions and 31 percent are in the hand of public. It was listed on the stock exchange in 1989.
In Usmania Glass, the plain and frosted sheet glass maker, the government has 51 percent shares, while institutions own 16 percent and public shareholders own 33 percent stakes.
sarwar@thedailystar.net

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