The Securities and Exchange Board of India (SEBI) on Thursday banned till further orders, the promoters of Pyramid Saimira Theatre Ltd (PSTL), PS Saminathan and Nirmal Kotecha, journalist Rajesh Unnikrishnan, public relations professional Rakesh Sharma and another person Pratheesh Kumar VK from the securities market till further orders.
They have been banned for their involvement in forging a SEBI document and manipulating the share price of the company.
There were media reports on December 21 and 22, 2008 that SEBI had ordered PS Saminathan to make an open offer for an additional 20 per cent stake in Pyramid, which owns multiplexes and also distributes films, at a price not less than Rs 250 per share within 14 days, for allegedly violating creeping acquisition norms. SEBI had clarified on December 23, 2008 that no such order or letter was issued. .
Following investigations, SEBI found that the forgery was done to manipulate the stock price of PSTL and Nirmal Kotecha, one of the promoters and largest shareholder of PSTL, was one of the major beneficiaries of the said manipulation and appeared to have largely masterminded the forgery.
Kotecha was found to be using large number of front accounts including his related persons/entities to manipulate the securities market and to route the funds through several layers to hide the source and flow of funds. These acts of Nirmal N Kotecha are detrimental to the interest of genuine investors in the securities market and pose a threat to the efficient functioning of securities market, SEBI said in its order. Several persons and entities have been prima facie found to have aided/abetted Kotecha in his activities. The promoters and officials of Pyramid could not be reached for their reaction.