Stock regulator to probe United Airways hiccups

The stockmarket regulator yesterday formed a three-member panel to investigate the recent developments at United Airways.

The team will look into the private carrier's suspension of operations, reconstruction of its board, resumption of operations and its trade pattern on bourses, said Saifur Rahman, spokesman of Bangladesh Securities and Exchange Commission.

BSEC Director Md Abul Kalam will lead the probe with deputy directors Mohammed Nazrul Islam and Mohammad Al Masum Mirdha being other members of the team.

“The regulator also asked the committee to submit a report within the next 21 working days,” said Rahman, also an executive director of the BSEC.

Meanwhile, price of United Airways shares rose 7.34 percent yesterday, as the private carrier came back in flights operations after a three-day pause over a conflict among board members.

Each share of the lone listed airline traded between Tk 11.90 and Tk 11.60, before closing at Tk 11.70 on the Dhaka Stock Exchange.

During the four-hour trading session, the price also touched the 'circuit breaker' that did not allow the stock to go beyond Tk 11.90 for the day.

The price of a stock cannot increase or decrease by certain percentage on a trading day as per the circuit breaker rules of the DSE. In the case of United Airways, which was listed on the stock exchanges in 2010, the share could increase by 9.17 percent at most.

More than 83.53 lakh shares were traded, generating a turnover of Tk 9.86 crore.

United Airways resumed its domestic and international flights on Saturday after its board members settled disputes at a meeting on Friday night.

The airline had suspended operations on Wednesday evening for an indefinite period after the company faced a cash crunch due to the failure of its reconstituted board to come up with a plan.

The board was reshuffled on September 22, after Tasbirul Ahmed Choudhury was forced to step down from the post of chairman and managing director because of internal conflict over the company's income and expenditure.

Mohammed Mahtabur Rahman, a director, was subsequently appointed chairman, while Shahinoor Alam was made acting managing director and Ferdous Imam acting chief executive officer.

But after the Friday's meeting, Choudhury was reinstated as the managing director and founder chairman, while Rahman retained his new post as chairman; Alam was made vice-chairman.

The airline, which had not earlier given any posting on the bourses' websites and trading servers about the operational suspension though it was supposed to do so as per securities rules, finally came up with a posting yesterday.

The posting said, as the company secretary did not attend office due to illness, no news could be provided about the suspension of operations.

“The previous management took over again and flights resumed from September 27 morning. The management expresses their deepest regret for all that happened from September 24 to 26,” according to the posting.

Set up in 2007, the airline has 11 aircraft in its fleet: two Airbus 310s, five MD-83s, three ATR-72s and one Bombardier Dash-8.

United Airways operates domestic flights to Chittagong, Sylhet, Jessore, Cox's Bazar, Rajshahi, Saidpur and Ishwardi.

On the international routes, it flies to Dubai, Kuala Lumpur, Kathmandu, Kolkata, Jeddah, Bangkok, Muscat and Singapore.

General investors hold 74.37 percent of the airline's shares, institutional investors 17.19 percent and sponsors and directors 8.44 percent.