- POSTED: 07 Oct 2013 06:18
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Trading in commodity-investing companies Asiasons, Blumont and LionGold resumed on Monday morning after the Singapore Exchange (SGX) lifted the suspension it imposed on Friday.
SINGAPORE: Trading in commodity-investing companies Asiasons, Blumont and LionGold resumed on Monday morning after the Singapore Exchange (SGX) lifted the suspension it imposed on Friday.
The exchange, however, declared the stocks "designated securities", which will be subject to these restrictions: Sale of shares is prohibited unless the seller holds the designated securities in the quantity to be sold, while buying is not allowed unless the buyer makes cash payment at the time his order is executed.
Under its trading rules, the SGX may declare a listed security to be a "designated security" if, in its opinion, there has been manipulation of the security or excessive speculation, or it is desirable in the interest of the market.
The SGX may also impose additional conditions, such as prohibiting short-selling, new contra trades and Internet trading on such securities, if it deems them necessary.
In a statement, the exchange said it will continue to monitor the trading of these securities and review the circumstances in due course, as it advised shareholders and investors to "trade with caution".
Trading in the three stocks was suspended on Friday after shares of the commodity-investing companies plunged between 42 and 61 per cent, wiping more than S$5 billion in total off their market value.
The exchange said the three suspensions were to "safeguard the interests of the markets as there could be circumstances that would result in the market not being fully informed".
Blumont tumbled 56.4 per cent to 88 cents per share before trading was halted on Friday morning, slashing S$2.9 billion from its market capitalisation and resulting in the investment firm calling off a takeover of Australian coal miner Cokal.
Blumont shares have risen from S$0.30 to S$2.45 apiece between Jan 2 and Sept 30 this year, before making a sharp U-turn on Tuesday after the SGX questioned the company over the "steep increase". In the nine months to September, its market value increased 12.5-fold from S$508 million to S$6.3 billion, including new shares issued.
Shares in gold miner LionGold and its biggest shareholder, Asiasons, plummeted 42.1 per cent and 61.5 per cent to 87.5 cents and S$1.04, respectively, on Friday. That wiped off S$585 million from the market cap of Liongold and S$1.6 billion from that of Asiasons.