STO opens up sale of shares

The State Trading Organisation (STO) has begun the sale of over 100,000 shares to the public today under the government’s privatisation policy.

Speaking at a press conference, Aishath Shaffana Rasheed, secretary general, said 138,472 shares will be up for sale from today to 10 January 2010.

When the sale of shares is complete, the share of the public in the company will increase from 7.71 per cent to 20 per cent and the government’s share in the company will be reduced from 92.29 per cent to 80 per cent,” she said.

She added the company aimed to eventually reduce the government’s share to 50 per cent.

The price of a share is Rf400 (US$31) with a face value of Rf50 (US$3.8) and an individual can buy a minimum of five shares, she said, while foreign investment companies will not be eligible.

Although a maximum amount has not been set, she added, under company regulations, an individual cannot own more than five per cent of the company’s shares.

Forms for the purchase of shares will be available from the STO head office and has to be submitted at the Bank of Maldives or its designated branches and mobile teams.

The purpose of selling STO shares is to reduce the government’s share and implement the government’s privatisation policy, she said.

Last year, STO handed out Rf65 (US$5) in dividends.

Shahid Ali, STO managing director, said the pro rata [in proportion] allotment of shares would ensure that all persons who apply for shares will be able to purchase even if the applications exceed the number of shares available for sale.

Mobile teams will visit the islands without bank branches to allow people to purchase shares, he said.

Farooq Umar, chairman of the STO board, said the five per cent ceiling will be a safeguard against companies purchasing more shares than the general public.

STO was established in 1964 to import essential food items, but has since diversified into areas such as energy and trade in consumer electronics.

The provisional income statement for the quarter that ended on 30 September shows that the company made a gross profit of Rf120.1 million (US$15.6 million) in the third quarter and Rf352 million (US$27.3 million) so far this year.

STO was registered in the Maldivian stock exchange in 2001.