Jumping off the sinking (Glass) Ship ?

section 69 of the companies act says...

section 69.
(1) Where a share is redeemable on a specified
date —

a.the company shall redeem the share on that date;

b.the share is deemed to be cancelled on that date;
and
c.from that date, the former shareholder ranks as an
unsecured creditor of the company for the sum
payable on redemption.

only option shareholder has is taking a court order against the notice before the notice date expired.

After the notice date expired he deemed to have sold his shares to the company..

Thanks @ Malanp.   

@ malanp and Dileepa

Hats off to both of you for the brief and admire the knowledge you have on the subject. Many thanks.

@ Kithsiri

Thanks to you as well Kithsiri for bringing up the topic.

Don;t know about chances of GLAS delisting here so soon as Dileepa pointing out.

But a very good ( common) discussion came out of it.

As Malanp pointed out, I believe company can make an offer ( to their discretion based on some formula which I am sure takes the market price and assets into consideation ) and if share holder does not accept before deadline that person can be held high and dry

Need to read further the document/act and maybe Marlanp can disclore the share price determining part.

Also my observations on GLAS below

http://forum.srilankaequity.com/t32308p75-cse-in-2014-and-fundamental-shares-that-have-underperformed#193636

slstock wrote:Don;t know about chances of GLAS delisting here so soon as Dileepa pointing out.

But a very good  ( common) discussion came out of it.  

As Malanp pointed out, I believe company can make an offer ( to their discretion based on some formula which I am sure takes the market price and assets into consideation )  and if share holder does not accept before deadline that person can be held high and dry

Need to read further  the document/act and maybe Marlanp can disclore the share price determining part.

Also my observations on GLAS below

http://forum.srilankaequity.com/t32308p75-cse-in-2014-and-fundamental-shares-that-have-underperformed#193636

With regard to price determining part, I presume there is no set or guided formula for this and it is on sole discretion of the management. If that is the case, I think it is a weakness in the system as company is always try to buy back at lower levels and not in favour of shareholders. Over to your malanp if you have time to enlighten us on the matter.

slstock wrote:Don;t know about chances of GLAS delisting here so soon as Dileepa pointing out.

But a very good  ( common) discussion came out of it.  

As Malanp pointed out, I believe company can make an offer ( to their discretion based on some formula which I am sure takes the market price and assets into consideation )  and if share holder does not accept before deadline that person can be held high and dry

Need to read further  the document/act and maybe Marlanp can disclore the share price determining part.

Also my observations on GLAS below

http://forum.srilankaequity.com/t32308p75-cse-in-2014-and-fundamental-shares-that-have-underperformed#193636

Sls

There is no specific price formula mentioned in the law but the section 66 says how to arrive at the share price.

..." for a consideration that is SPECIDIED or TO BE CALCULATED BY REFERENECE TO A FORMULA or REQUIRED TO BE FIXED BY A SUITABLY QUALIFIED PERSON who is not associated with or interested in the company"

then section 64 says the procedure to be followed..
...."the consideration to be paid for the shares is in the opinion of the company’s auditors a fair value"

That means after deciding the share price under section 66, the auditors has to certify that it is a fair value.

After that the company can notice the public along with the auditors certificate that they are going to buy back shares at XXX price, on this date.. and after that date share holders will become creditors and company will pay the value to the shareholder.

In a share buying back case shareholders have very limited options.

Thank you for further clarifications which should make the points clear.

And yes of course, the company concerned should come up with the price/formula and a law cannot state such .

Maybe I was not clear when I said "to their discretion based on some formula which I am sure takes the market price and assets into consideation "

I would expect delisting companies to "more" than a fair price compared to market.

Anyway, logically GLAS should not be in such danger immediately.

There are few other companies that can get delisted : CDIC, CARDS group palm oil companies ( INDO, SHAL , GOOD etc ) and some family held companies who does not want to sell shares to public.

I am yet to see SFCL and ASPM trade though listed at CSE.

Also few other illquid companies serious delist or increase illquidly. SWAD , OFEQ comes to mind to start with.

malanp wrote:

slstock wrote:Don;t know about chances of GLAS delisting here so soon as Dileepa pointing out.

But a very good  ( common) discussion came out of it.  

As Malanp pointed out, I believe company can make an offer ( to their discretion based on some formula which I am sure takes the market price and assets into consideation )  and if share holder does not accept before deadline that person can be held high and dry

Need to read further  the document/act and maybe Marlanp can disclore the share price determining part.

Also my observations on GLAS below

http://forum.srilankaequity.com/t32308p75-cse-in-2014-and-fundamental-shares-that-have-underperformed#193636

Sls

There is no specific price formula mentioned in the law but the section 66 says how to arrive at the share price.

..." for a consideration that is SPECIDIED or TO BE CALCULATED BY REFERENECE TO A FORMULA or REQUIRED TO BE FIXED BY A SUITABLY QUALIFIED PERSON who is not associated with or interested in the company"

then section 64 says the procedure to be followed..
...."the consideration to be paid for the shares is in the opinion of the company’s auditors a fair value"

That means after deciding the share price under section 66, the auditors has to certify that it is a fair value.

After that the company can notice the public along with the auditors certificate that they are going to buy back shares at XXX price, on this date.. and after that date share holders will become creditors and company will pay the value to the shareholder.

In a share buying back case shareholders have very limited options.