Scangroup seeks nod to further delay its results

Scangroup seeks nod to further delay its results

WPP Scangroup CEO Bharat Thakrar. FILE PHOTO | NMG Marketing services firm WPP Scangroup has sought approval from the Capital Markets Authority (CMA) to delay publishing its annual results for the second time as investigation of its former executives continues.

The company was required to announce its performance in the year ended December by April 30. It applied to the regulator explaining the cause of the delay and stating that it would publish the results by May 31.

It missed its new self-imposed deadline and now says it expects to publish the results on July 31.

“The Authority remains in touch with the company and as would be expected, the external auditors require time to assess the impact of these developments on their opinion in relation to the financial statements before the same can be published,” CMA said in a statement.

“The company has therefore requested for an extension which is being considered by the Authority.”

The investigations that could impact the results indicate that the ouster of the company’s executives –former CEO Bharat Thakrar and chief financial officer Satyabrata Das— arose from financial misconduct.

The two former executives resigned after they were suspended by the firm’s board.

Mr Thakrar was the first chief executive of an NSE-listed firm to be suspended or sacked publicly for ethical misconduct. Most firms have opted not to disclose the reasons for the sudden departure of their leaders.

Mr Thakrar has been the face of Scangroup which he took public on August 29, 2006 in an initial public offering (IPO) that raised Sh94 million.

He was the top shareholder at the time with a 28.53 percent stake and his holdings was at one time valued at more than Sh1 billion. His ownership now has a market value of about Sh260 million. He sold his shares over the years, contributing to his ownership dropping to the current 10.6 per cent.

UK-based conglomerate WPP on the other hand raised its stake in the company to a controlling 56.3 per cent through a mix of share purchases and folding some of its subsidiaries into Scangroup.

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