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Sebi bars Austral Coke from raising funds

Sebi bars Austral Coke from raising funds
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First Published: Wed, Sep 02 2009. 11 08 AM IST
Updated: Wed, Sep 02 2009. 11 08 AM IST
Mumbai: The markets regulator Sebi has barred Austral Coke & Projects Ltd from raising fresh capital after the income-tax department told the regulator the company had manipulated its financial accounts.
The metallurgical-coke maker’s board was set to meet on 3 September to consider raising up to $200 million through a share sale to institutional investors. The board was also to consider a bonus issue of shares.
“...hereby prohibit Austral Coke and Projects Limited from raising any further capital in any manner, directly or indirectly, whatsoever till further orders,” the sSecurities and Exchange Board of India (Sebi) said in an order on its website late on Tuesday.
Sebi said the income-tax department charged that Austral had misused money raised from its initial public offering (IPO). The regulator added it has ordered an investigation into the trading of the company’s securities.
Rishi Raj Agarwal, managing director of Austral, however, denied allegations of misuse of IPO funds, the Economic Times newspaper said.
“There has been no diversion of IPO money. IPO funds have been used to acquire mines,” Agarwal told the paper. Reuters could not reach Agarwal at his Mumbai office.
Austral shares opened down 5% at Rs48 a share in a weak overall Mumbai market.
“There is a news item today there was a raid on Austral Coke’s office premises. It will not be allowed to raise further funds,” a dealer at B&K Securities said, referring to the stock’s decline.
“The raid happened three months ago. If there was anything substantial our bank account would have been sealed, Agarwal told the newspaper.
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First Published: Wed, Sep 02 2009. 11 08 AM IST
More Topics: Austral Coke | Sebi | IPO | Funds | Rishi Raj Agarwal |