ChannelLife NZ - VMob hastens to squash rumours of insider trading

Warning: This story was published more than a year ago.
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VMob hastens to squash rumours of insider trading

VMob Group has released a statement acknowledging the market speculation regarding certain VMob directors and insider trading.

In the statement VMob acknowledges the media and market comment about the participation of certain VMob directors in its recent private placement capital raising, and the allegations of insider trading against the participating directors.

The completion of the private placement was announced to the market on 26 January 2015. 

On January 23 VMob says it had “successfully completed a private placement of 205,137,771 ordinary shares at AU$0.01/NZ$0.0106 per share, raising $NZ2,174,166 million.”

“The capital raising was undertaken in both New Zealand and Australia and was supported by a mixture of high net worth individuals, institutions and certain VMob directors," says VMob.

In the statement released on the 29th January, VMob said the company and its directors are concerned about the ill-informed nature of the comments about insider trading.

“There is no question of insider trading by VMob or its directors or anyone else in relation to the recent private placement. The Financial Markets Authority (FMA) has confirmed this to VMob,” the statement read.

VMob says it received legal advice on the private placement process which, as previously announced to the market on December 11 2014, involved negotiations with interested parties to raise the desired capital.

“Those parties were mostly made up of high net worth individuals and institutions. Some of those parties were keen that VMob directors also participate in the capital raising to demonstrate their confidence in the company and further align their interests with those of other shareholders,” the statement read.

“The participation of directors in the private placements is entirely appropriate. It is expressly allowed, and catered for, under the NZAX Listing Rules,” says VMob.

In the statement VMob provided details of the laws surrounding the private placement of shares.

“The new insider trading rules in the Financial Markets Conducts Act 2013 do not apply to the issue of new shares by private placement (refer clause 20 of Schedule 1 to the Financial Markets Conduct Regulations 2014).

“This was also the case under the previous insider trading rules in the Securities Markets Act 1988.

“VMob is entirely confident that it and its directors have complied fully with all legal and compliance requirements, including under the Companies Act 1993 and the NZAX Listing Rules, regarding the undertaking and announcements of the private placements," says the company.

According to VMob, the FMA has confirmed it is not investigating or making any enquiries of the company regarding insider trading involving the placements.

However, the FMA has requested information regarding the private placements, and VMob says it will provide the required information.

The comapny says despite the allegations, it remains focussed on implementing the recently announced global agreement with McDonalds and executing other deals. 

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