RIYADH, 22 July 2005 — A number of shareholders of the Saudi Public Transport Company (SAPTCO) filed a complaint with the Capital Market Authority (CMA) against the chairman of the board of the company because of his contradicting statements, reported Al-Watan. They are asking the CMA to investigate him because they claim that the his statements caused some losses to shareholders.
In the complaint to the CMA the shareholders said that a statement by chairman of the company dated May 2 stated that the company will increase its capital if the company won the contract to transport sand to the kingdom of Bahrain. Because of the statement, the price of shares continued to rise from SR135 per share to SR250, 75 per share. The chairman of the company issued another statement on July 11 saying that the company finished the final preparations to transport sand to the kingdom of Bahrain using the company’s trucks but the company did not study the financial effect of this project on the company.
In the complaint letter, the shareholders asked how could a company the size of the public transportation company apply for such huge project and not know whether financial the effect on the company would be positive or negative. There was not information on the second statement on the length of the contract and whether there would be an increase in capital. That was considered misleading. The contradicting statements caused the increase in the share value on the basis of the first statement and the decline of the share value on the second statement. Shareholders called for an investigation, for compensation for their losses and for more transparency.