lock-in Rule for private equity By SEC

milanka · 1 lock-in Rule for private equity By SEC Mon Feb 07, 2011 6:58 pm

milanka

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Sri Lanka's markets regulator has imposed a one-year 'lock-in' period for the sales of shares given to private equity investors in a company before a listing, a statement said.

Shares allotted to investors within a period of one year prior to listing on the Colombo Stock Exchange shall be locked-in for a year from the date of allotment of such shares, the statement from the Securities and Exchange Commission said.

The Colombo Stock Exchange listing rules have been changed with the new rule applicable to firms which list on the CSE after April 01, 2011, it said.

The CSE expects a flood of share issues this year after the market rose to record highs on the back of improved economic growth and corporate earnings with the end of the island's 30-year ethnic war in 2009.

Source : lbo.lk

Gaja · 2 Re: lock-in Rule for private equity By SEC Mon Feb 07, 2011 7:00 pm

Gaja

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In my personal opinion i think this was a good move, what do you all think about it

tubal · 3 Re: lock-in Rule for private equity By SEC Mon Feb 07, 2011 7:01 pm

tubal

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About time too.
If I remember correctly this rule used to be in place a long time back. But when the market was having it's long bearish period with no one looking to get listed. They removed it.

BullionStock · 4 Re: lock-in Rule for private equity By SEC Mon Feb 07, 2011 9:39 pm

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They have not mentioned the reason for imposing the lock-in rule

I think this will help cse regulators to address the over-subscription.
So IPOs coming up after April 1st , will not be much oversubscription as of today.

I think most retail investors who are looking for short-term profit will avoid go for IPOs , so then big long-term investors can get allocated their quota as planned.

Will company get any disadvantage over IPOs after 1st of April ?

Gaja · 5 Re: lock-in Rule for private equity By SEC Tue Feb 08, 2011 12:08 am

Gaja

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with your explanation, i got confusion i understood in this way, the persons who have the shareholders before the listing can't sell those shares for one year. Even these people can apply for IPO and what ever shares alloted there can be traded as normal. Can anybody confirm which one was right.

I think this will be a issue for future Private Placements

BullionStock · 6 Re: lock-in Rule for private equity By SEC Tue Feb 08, 2011 12:15 pm

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Yes this is for private placement . I read some news today & understood well.

So there will be no disadvange for public who buy at IPOs

Thanks Gaja for your review Smile