Piaggio Seeks Sebi Probe Into Lml Scrip Spurt

Piaggio, the Italian scooter major, has shot off a letter on October 19 to the Sebi asking it to investigate a sudden spurt in traded volumes of the shares of LML on certain days.

Piaggio has requested the regulator to probe if these transactions are motivated buying by some parties and whether they violate the existing takeover code. Piaggio executives, however, were not available for comment on the issue.

However, under the joint venture agreement the two partners in LML Ltd-Piaggio and the Singhania family, each of whom holds 23.6 per cent equity stake, have a clear agreement that none of them will buy any share from the market to increase their holding.

Source said large and unusual share transactions took place in the share on certain days which were much higher than the normal trade volumes of the scrip. The scrip price has been hovering at around Rs 52-56 in the last few weeks.

The share price of the company's shares have also gone through numerous ups and downs going up to Rs 160 in April 1998 end and then crashing to Rs 74 in end of June and falling further to new lows.

Volumes of the company shares traded have also gone though violent ups and downs. For instance, volume traded on October 3, `97 was only 1,18,032 going up to as high as 60,86,349 on April 24, `98. The fresh salvo comes at a time when a slated meeting between representatives of the two estranged partners has been postponed.

Sources say that the Singhanias gave reason of being unwell for not attending the meeting. Sources close to LML, however, have said that they have not made up their mind on the meeting.

LML has alleged various breaches in the export contract by Piaggio, and refusal to give technology as promised, while Piaggio has accused LML of doctoring minutes of the meetings, allowing directors to have business relationship with the company, and refusing permission for allowing them to audit LML. LML, however, denies the charges.