By Hamza Hendawi
NICOS Shacolas’ Woolworth and CTC yesterday sought the approval of the Cyprus Stock Exchange for a week-long voluntary suspension to update their share registers, starting Monday.
The exchange was expected to announce its decision on Monday, but its approval is almost a foregone conclusion since it has clearly stated its wish to see all listed companies have a clean slate by November 29, when a new settlement system is scheduled to come into force.
The exchange has warned that the full weight of the law will come down on any listed company that delays issuing share deeds from November 29 onwards.
If suspended, CTC and Woolworth would on Monday take to 12 the number of companies either suspended by the exchange or having opted out voluntarily to update their registers.
Besides Shacolas’ two giant retailers, the 12 include Bank of Cyprus, Popular Bank, Hellenic Bank, Cassoulides & Sons, Vassiliko Cement, Frindlays Properties and Investments, Orphanides Supermarkets, Cy-Venture, Minerva Insurance and Astarti Development.
The suspended companies make up nearly a quarter of the total number of those listed on the exchange and include five — the three banks, Vassiliko and CTC — which are among the 10 largest companies in terms of capitalisation.
The capitalisation of the 12 companies combined is close to £8 billion, while the market’s total capitalisation stands at £11.1 billion.
The absence of the three banks, which have traditionally dominated the market, has ushered a shift by investors to small cap shares. With many investors chasing a few shares, the value of most small caps shot up unrealistically over the past week but traders expect the trend to go into reverse when the banks return to the market, possibly on November 29.
The absence of the banks, meanwhile, is now known to be behind the market’s seemingly aimless movement, which started on Thursday.
The all-share index yesterday closed up at 805.18, 1.54 points, or 0.19 per cent, on a volume of £43.95 million.
Five of the market’s sectors finished the day down, with the remainder — insurance and “other companies” — gaining 1.52 per cent and 1.85 per cent respectively.
Investment powerhouse Athienitis & Severis Financial Services Ltd, meanwhile, announced yesterday that it was hoping to have its shares traded on the Cyprus Stock Exchange starting from mid-December.
It said 220,000 shares of nominal value of 40 cents would be offered to the public on November 25 and 26 at £2 apiece. Another 1.19 million shares of the same price and nominal value will be offered to investors through a private placement.
Athienitis & Severis is the island’s second largest brokerage in terms of market share behind CLR. The value of its share is expected to soar immediately after the listing, partly due to investors’ hunger for new issues.
A dearth of new shares on the exchange has been blamed by some brokers for the unrealistically high value of most shares available at present.
They blame the shortage of new issues on what they see as the exchange’s painfully slow processing of listing applications. Exchange Chairman Dinos Papadopoulos, however, says that up to 30 new companies will be listed between now and the end of 2000. The exchange currently has 53 listed companies.
