Insists on “precise” action plan
The Securities and Exchange Commission (SEC) yesterday said it requested from Kalpitiya Beach Resort PLC to postpone the firm’s Extraordinary General Meeting (EGM) by another month from the scheduled date as the company needs to come up with a “precise” action plan to protect minority shareholder interests.
The SEC said it was making this request from the company as it was of the opinion that alternate courses of actions provided by the company in a shareholder circular lacked “specific direction.”
SEC in a previous directive told Kalpitiya Beach Resort to hold an EGM by May 10, 2015 to account for Rs.283.5 million it raised through an Initial Public Offering in November, 2011.
The SEC noted that the prospectus of the IPO stated that construction would commence in December 2011, and the resort would be operational early this year, and any contradiction to the plans would be communicated to the shareholders through an EGM, none of which occurred.
In response to this, in a shareholder circular the company said it was looking for alternative locations in Sri Lanka and Maldives to develop its resort project, given the lack of development in the
“Due to the delay in the development in the Kalpitiya region by the government, the directors were compelled to hold back their plans to commence the construction of the hotel (and) explore the feasibility of an alternative location, within Sri Lanka and Maldives as an alternate destination to Kalpitiya,” the company said in the circular.
It also said the company was looking for possible investors to overcome risks in developing in the underdeveloped Kalpitiya region, as well as partners who could create products such as golf courses and theme parks.
However, it also said that the new regime has shown interest in developing Kalpitiya, which would boost the viability
of the project.