Monday, February 21 2011 18:08
Shen Concern refuses to comment on transaction on purchase of Hansman panel plant
ArmInfo. Shen Concern, a large producer of construction materials, does not comment on its recent transaction on the purchase of the Hansman panel plant in Yerevan. The company is listed in NASDAQ OMX Armenia. This obliges the company to regularly provide information about its activity to the mass media, the public, and upon the specific request of the residents.
The given circumstance once again proves some experts' opinion that not a single economic entity in Armenia is ready for publicity. And any statements by issuers about the intentions to enter the capital market are nothing but PR. Via the issue of corporate bonds and IPO, the local issuers also pursue the goal to attract available funds from the market, which will allow them to increase the production output and expand the activity of their own company. Experts think that the local issuers have a different culture of business conduct due to the lack of modern principles of corporate management.
To recall, in early December 2010 Shen Concern carried out the fifth issue of its bonds (the initial offering took place in early November) worth 500 mln AMD, which were listed Bbond in the stock exchange. The company attracted 1.5 bln AMD more due to the additional issue of corporate bonds by means of private offering in November. The company was going to spend the funds attracted from the market on construction of 4 new shops for processing of construction materials. In addition, the company was planning to upgrade the shops for production of dry stocks. Despite some debt appreciation (from 11% in the 4th issue to 12.5% in the 5th issue), the 5th issue was actually attraction of funds for purchasing of the idle Hansman plant.
To recall, in 2009 the European Bank for Reconstruction and Development (EBRD) withdrew from the enterprise's capital upon completion of the contract. The shares were redistributed and consolidated. For the first time the company entered the market of corporate bonds in 2006 with an issue worth 40 mln AMD.
To note, Shen Concern CJSC was founded in 1995. At present the company is mostly engaged in production and sale of construction materials.