Kathmandu. The Securities Board of Nepal (SEBON) has said that it has drawn serious attention to the sale and distribution of shares in the name of pre-IPO.
Issuing a press release today, SEBON said it has drawn serious attention to the issue in the context of complaints received from investors to stop the issue immediately as they are raising money in the name of pre-IPO of various organized organizations through social media (WhatsApp, Viber, Facebook group), e-mail and SMS in the near future.
The Securities Board has clarified that there is no provision regarding pre-IPO in the prevailing law and sub-section (1) of Section 29 of the Securities Act, 2063 provides that if an organized organization sells securities to more than 50 people at a time, then such securities will have to be issued to the public for the sale and distribution of such securities. “Therefore, it is advised not to indulge in activities relating to the purchase or sale of shares of publicly organized entities without obtaining permission from the Securities Board,” the securities board said. ’
The Securities Board has also requested all investors not to participate in such activities.
