Pakistan's securities regulator, the SECP, has asked seven banks to supply export records linked to the planned initial public offering (IPO) of SE Fruits and Vegetable Limited. An IPO is the first sale of a company's shares to the public. The Punjab-based fruit exporter was previously named Shaheen Enterprises, and the request was made public in a statement issued on Saturday, 7 November.
What the SECP is examining
The inquiry goes well beyond export paperwork. The regulator has also asked 30 banks for information on foreign remittances, meaning money sent into Pakistan from abroad, along with export proceeds and other foreign exchange dealings tied to the sponsors and directors of the firm. Some banks have replied and their answers are being checked, while submissions from the IPO's joint lead managers, Topline Securities and Growth Securities, and from the consultant Parker Russell–A.J.S. are also under review.
The regulator opened the probe on October 21, relying on section 29 of the SECP Act, 1997 and section 139 of the Securities Act. Its team is going through the IPO application and records of who owns the company's shares. The CDC, which keeps share records in electronic form, supplied an investor list and later received a request for shareholder lists and past share transfers for people named in the prospectus, the document setting out an offer's terms. Its reply, received on November 2, was partial and is still being checked.
The company's auditor, Ilyas Saeed & Co., asked for more time to supply the requested information and records, and the SECP agreed to an extension. The probe follows concerns about the company's financial reporting and audit.
Offer terms and the reported figures
The SE Fruits IPO was meant to raise up to Rs1.92 billion by selling 30 million shares at Rs40 each. Those terms do not add up. Thirty million shares at Rs40 comes to Rs1.2 billion, not Rs1.92 billion, and the gap is not explained in the information released so far. The SECP halted the offer in October, and the company later withdrew it.
Timeline: what has happened so far
- October 21: The SECP opens its investigation into the proposed SE Fruits IPO.
- October: The regulator halts the IPO, and the company later withdraws the offering.
- November 2: The CDC's response on shareholder information is received; it is partial and under review.
- November 7 (Saturday): The SECP says it has sought export records from seven banks and foreign exchange information from 30 banks. Some banks have responded.
Aasan alfaaz mein
SECP ne SE Fruits and Vegetable Limited ke IPO ki probe mein saat banks se export records aur 30 banks se foreign remittances ki maloomat mangi hai. Company 30 million shares Rs40 each par bechna chahti thi, lekin October mein IPO rok di gayi aur company ne offer wapas le li. Aam shehri ke liye iska matlab yeh hai ke maamla abhi jaari hai. Rs1.92 billion aur 30 million shares ke Rs40 wale hisaab mein farq ki wajah abhi saamne nahi aayi.
