DIRECTORS in listed companies have become increasingly lax about notifying changes to their shareholdings.
DIRECTORS in listed companies have become increasingly lax about notifying changes to their shareholdings.
Latest statistics from the Australian Securities Exchange show that compliance levels regarding the disclosure of directors’ interest notices had slipped in the three months to the end of September.
The Markets Supervision arm of the ASX reported that, of the 3,077 notices lodged during the quarter, 8.1 per cent, or 250 notices, breached listing rules due to incompleteness or late disclosure.
This was an increase from 6.4 per cent in the same period last year, and higher than the last time the ASX conducted a review, in the March quarter of this year where 7.3 per cent were found to be in breach.
“While compliance levels continue to be high – over 90 per cent – there is no satisfactory excuse for failing to meet disclosure rules every time,” ASX chief supervision officer Eric Mayne said.
“Failure to disclose creates the perception of misconduct.”
The bulk of the 250 breaches recorded in the September quarter – about 42 per cent or 106 – also involved a potential breach of the Corporations Act by being lodged later than 14 days.
The ASX said all 106 potential breaches have been referred to the Australian Securities and Investments Commission.
The number of directors’ interest notices has also declined 9.3 per cent from the last review.
Options
Directors in Andean Resources and Riversdale Mining have taken advantage of their company’s higher share prices with the exercise of options ‘in the money’. Andean independent director Patric Esnouf boosted his shareholding through the exercise of 1 million options at 25 cents each for a total of $250,000, before the deadline of October 31.
Andean’s share price has risen over the past year from 60 cents to about $2.50, which gives the company a market capitalisation of $1.1 billion.
Mr Esnouf still holds 2 million options that are exercisable at either 30 or 35 cents before November 2010.
Riversdale deputy chairman Andrew Love has exercised 100,000 options for a total of $150,000.
The options were exercisable at $1.50 before November 21. Coal miner Riversdale is currently trading at about $5.85, up from $2.45 a year ago.
Mr Love still holds onto 200,000 options exercisable at $2.03 and $2.50 before February 2011.
Not quite so ‘in the money’ was CO2 Group non-executive director Malcolm Hemmerling who exercised 500,000 options at a slight discount to the company’s trading price.
Mr Hemmerling paid $160,000, or 32 cents each, to convert the options into shares on a day when CO2’s share price was trading at about 33.5 cents.
