share trading pre suspension to be investigated

  1. 4,253 Posts.
    lightbulb Created with Sketch. 11

    Austrim faces ASX probe into share trade
    By Leonie Wood
    September 1, 2003

    Print this article
    Email to a friend

    The Australian Stock Exchange is examining what it considers unusual trading in the shares of Austrim Nylex ahead of the company's $80 million share placement this week.

    Shares in the diversified manufacturer dropped sharply over two days, falling from 43.5¢ during trading on Tuesday to 36.5¢ at the close of trading on Wednesday, before the company sold more than 300 million new shares at 25¢ each.

    More than 5 million shares changed hands during the two days before the stock was suspended for the share placement.

    An ASX spokesman confirmed the exchange's surveillance team was aware of "unusual price movements" in the days before the share placement.

    "We are looking into it, into the otherwise inexplicable movements in the shares," the ASX spokesman said, noting that it is an offence to sell shares that had not been issued.

    Austrim Nylex on Thursday morning requested a suspension from trading and then authorised Bell Potter Securities to place about $65-70 million of new shares with institutional investors.



    Fund managers responded enthusiastically, swamping the broker with orders, so Austrim Nylex decided to increase the size of the placement to $80 million. Austrim Nylex then cut its proposed purchase plan - the offer it plans to make to retail investors - from $15 million to $8.5 million.

    The share raising swells Austrim Nylex's issued capital from about 243 million shares to almost 600 million, leaving it with a market capitalisation of about $150 million based on the 25¢ issue price of the new shares.

    Proceeds of the raising are expected to be directed to paying down debt and stabilising the company's balance sheet.

    Austrim Nylex is due to release its June-year earnings figures today.

    Print this article Email to a friend Top
arrow-down-2 Created with Sketch. arrow-down-2 Created with Sketch.