The Securities and Exchange Commission of Pakistan (SECP) has given show-cause notices to the directors-elect of the Haseeb Waqas Sugar Mills Limited (HWSM) and the directors of group companies of the First Capital Equities Limited (FCEL) after being accused of violating sections 4 and 5 of the Takeover Ordinance.
Majority of shareholders sent their complaints to the Commission in January 2005, claiming that a group of people illegally received 39 percent of shares of the sugar mills violating the 2002 Listed Companies (Substantial Acquisition of Voting Shares and Takeover) Ordinance (Takeover Ordinance).
The Commission's SMD commissioner, in an order on October 1, 2007, issued the notices to Directors-elect Iqbal Latif, Pervaiz Akhtar and Shujaat Ali Khan and the directors of the equities and the group, including Shaheen Insurance Company Limited, World Call Communication Limited and World Call Telephony (Private) Limited.
The directors-elect appealed against the order. The Commission's Appellate Bench in its order dated March 6 dismissed the appeals saying the show-cause proceedings were itself inquisitorial in nature and failed to amount to indictment. It considered the appeals premature since no cause of action had accrued to the appellants.
The mills current management then filed an affidavit saying the directors-elect had tried to threaten them to take control of the company's affairs. A Lahore High Court order on February 2, 2007 has already stopped the directors from exercising their rights as a director in the mills.-PR
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