By Hamza Hendawi
AKEL Deputy Takis Hadjigeorgiou announced yesterday that he planned to donate to charity all profits made from the £10,000 worth of shares he obtained from Louis Cruise Lines’ private placement.Government spokesman Michalis Papapetrou, meanwhile, said that Central Bank Governor Afxentis Afxentiou held an independent post, and he as spokesman could therefore not comment on his controversial acquisition of Louis’ shares through the private placement.Papapetrou, however, added that Afxentiou would not have acquired the shares had he known of the government’s stance on the issue.The Central Bank Governor made a spirited defence of his integrity in several radio and television interviews on Thursday, accusing his critics of fabricating “scandal scenarios” aimed at tarnishing his name.Afxentiou obtained £5,000 worth of shares in Louis, while his son, auditor Costa Afxentiou, obtained £20,000 worth of the stock, according to a list of private placement beneficiaries obtained by the Cyprus Mail.The Louis private placement was worth £8.95 million at 40 cents a share. The share’s value soared to £3 on the first day of trading in early August, realising massive profits for investors. The value of the share, however, dropped soon afterwards when it emerged that top Louis executives had dumped tens of thousands of shares on the first day of trade.The Initial Public Offering of Louis was worth £9.5 million and was oversubscribed more than 50 times, leaving investors with less than two per cent of the number of shares they sought. Investors with considerable financial muscle, however, were able to secure a decent number of shares by putting huge amounts of money up front.Money bid for the IPO totalled more than £500 million, a sum that was kept by Louis for two weeks according to the law before it began to send refunds to investors. The company has reportedly gained about £1 million in interest on the £500 million plus it was allowed to keep for those two weeks.Speaking on CyBC radio yesterday, Akel deputy Hadjigeorgiou insisted that he broke no laws when he applied last April to Louis to obtain shares in the company’s private placement, but added: “A politician should not only be honest but must also appear to be honest.”He said his decision to give to the island’s fertility centre profits generated by his 25,000 shares had not been taken under pressure, but informed sources said Hadjigeorgiou, who runs Akel’s Astra radio, was strongly admonished by party leaders for the embarrassment he caused over his inclusion in the private placement.Akel, the main opposition party, reacted with considerable indignation to revelations last month that ruling Disy and opposition Diko of House Speaker and former president Spyros Kyprianou obtained hundreds of thousands of shares in the Louis’ private placement.The party gave a guarded welcome earlier this week to President Glafcos Clerides’ ruling that obtaining shares in private placement by Cabinet ministers would provide sufficient grounds for their dismissal. Clerides is also seeking legal advice from the Attorney- general’s office on whether the ban could cover civil servants as well.Hadjigeorgiou said the issue of politicians, political parties and senior civil servants obtaining shares in Louis’ private placement would not have been publicised had it not been for the fact that the value of the shares had considerably risen since they made their market debut early last month.He also repeated the argument that he felt he had done nothing wrong when he obtained the shares because, as a deputy, he did not have the political leverage or power needed to influence decisions affecting public companies.Declaring that he was “deeply hurt” by the notion that his Louis shares’ acquisition smacked of favouritism, he said: “The responsibility lies with those who tried to boost the value of the share while they held them.”Beside Afxentiou and Hadjigeorgiou, those known to have received shares as part of the private placement are the Dias media group, which publishes the daily Simerini, the English-language weekly newspaper Financial Mirror, former Communications Minister Lentios Ierodiaconou, Vassos Pyrgos, the Communications Ministry’s permanent secretary, Director of Customs Andis Tryphonides, Panicos Pouros, director of the Finance Ministry’s Planning Bureau, Costakis Christophorou, director of the House of Representatives, Michael Erotokritos, director of the Ministry of Commerce and Industry, and Takis Kanaris, head of the research department at the Central Bank.
