CAPE TOWN – Calgro M3 was forced to collapse a share scheme for its executives as it frantically sought ways to shore up capital ahead of the release of its interim results, so that it did not breach its loan covenants.
This emerged after the developer of lifestyle estates, memorial parks and rental units on Tuesday tried to explain the reasons for the JSE’s public censure of the company.
The JSE said the group had failed to follow proper governance processes when it collapsed the share scheme for executives.
It said Calgro had been censured because it had breached listing requirements by failing to announce all share dealings by directors, failing to announce the terms of share repurchases, and that the JSE had not been notified if shareholder approval had been sought to approve a board resolution for such a share repurchase.
Calgro M3 in September last year decided to cancel the executive share scheme initially approved by shareholders in July 2015, due to the negative impact that new accounting standards IFRS 15 and IFRS 9 had on the net debt/equity ratio, and the gearing ability of the company in future.