SC probe on Mudajaya caused shares price drop
Filed Under (Business News) by Webmaster on 27-07-2010
Tagged Under : Mudajaya, securities commission
Shares of power plant builder Mudajaya Group Bhd fell for a second day as jittery investors booked in profits from recent sharp gains on a news report that the company had been probed by the Securities Commission (SC).
Mudajaya told the exchange yesterday it “has not been directly queried by the SC” but assured investors that “it is more than willing to extend its full cooperation” if queried by the regulator.
“The board of Mudajaya is not aware of the nature of the complaint about the company by anyone whosoever,” it said in reply to the exchange’s query on the report published over the weekend.
The stock fell as much as 5.3% yesterday after trade resumed following a one-hour suspension from the opening bell to make way for the announcement.
Mudajaya shed 19 sen, or 3.2%, to close at RM5.69 on volume of 2.78 million shares.
The stock hit a record high of RM5.94 on Thursday, driven partly by speculation that a big independent power producer might buy a significant stake in the company.
Tanjong Plc, which was linked as a potential buyer, had said it had no interest in buying a stake in Mudajaya.
StarBiz made several calls yesterday to Mudajaya’s office in an attempt to get some clarification on the SC probe, but failed to speak to any of the company’s top officials.
A spokesman at the SC yesterday confirmed that the regulator was “looking into the affairs” of Mudajaya following a specific complaint made against the company but declined to elaborate.
It is believed that Mudajaya’s management had met analysts yesterday in a bid to allay some of the concerns raised about the company.
An analyst told StarBiz that the management was unaware of the nature of SC’s probe.
But despite the lack of clear details, he remained positive about Mudajaya’s future prospects because of its strong earnings growth potential and steady recurring income.
