MANILA, Philippines - Newly-listed agricultural trading firm Calata Corp. said yesterday it has been aware all along of the investigation into the company for a suspected case of price manipulation and has promised full cooperation with the ongoing probe.
The market surveillance unit of the Securities and Exchange Commission is digging deeper into the case following a report by the Capital Market Integrity Corp. (CMIC), an independent unit of the Philippine Stock Exchange responsible for spotting illegal trading activities.
In a statement issued yesterday, company chairman and chief executive officer Joseph Calata pointed out that “at no stage has the SEC or CMIC officially contacted the company during the course of its investigations.”
“Actually, it was Calata which wrote to the PSE at the outset and requested for an investigation into the unusual and fluctuating movement of its shares during the particular period that is now the subject of the probe,” he said.
Nevertheless, Calata assured the investing public that the company would cooperate fully with the SEC to get to the bottom of things.
SEC Commissioner Juanita Cueto said the corporate watchdog is “prioritizing Calata”, noting that its surveillance unit has been meeting with CMIC people.
Calata rose to meteoric heights in the two weeks after its listing debut in May, hitting a high of P24 each share or more than three times its initial public offering price of P7.50. The stock has since plunged, finishing at P5.94 or 4.21 percent lower than the previous closing price of P5.70.
PSE president Hans Sicat, for his part, said the exchange has already done its part and the ball is now in the hands of the SEC.
Sources said the PSE probe, while inconclusive, cited suspicious trading of Calata shares by a handful of brokerage firms for clients who were allegedly dummies of unidentified people.
The dummy accounts were created to deceive investors by artificially affecting the stock price.
Price manipulation is any activity that attempts to interfere with the proper operation of the stock and create the false appearance of an active and liquid market.
If there are abnormal movements, such as sharp price rises or trading volume which cannot be explained by accessible market information, and the department believes that there is a suspicious trading pattern, a preliminary investigation will be conducted to search for any violation of laws or any attempt to manipulate the security’s price, the SEC official said.
When the preliminary investigation reveals a high probability of unfair trading, the case is sent to related authorities for further action.
SEC chairperson Teresita Herbosa previously said the commission would not tolerate any form of fraudulent trading activity and would aggressively police the conduct of those who seek to manipulate the stock market.
Meanwhile, Calata said the company is poised to exceed revenue targets for the first half of the year. It also expects to sustain its positive traction with the company’s Monterey Nucleus Hog Breeder Farm in Isabela now being fully operational.
Calata reported that its Argentinian counterparts for corn planting have recently concluded their due diligence and have given very encouraging results.
“They are very excited to start corn planting with Calata Corp. soon using their state of the art techniques and equipment,” Calata said.