FCA Final Notice: AIM listed company breached MAR with late disclosure of inside information

This is the first financial penalty imposed by the FCA on an Alternative Investment Market (AIM) company for late disclosure following the introduction of MAR on 03 July 2016, and also its first enforcement action of any sort under MAR.

Tejoori held two material share investments which were valued at $3.35m. On 12 July 2016, Tejoori was notified about a compulsory acquisition of those shares at a value which was materially lower. The information about the compulsory acquisition was inside information and, under MAR, Tejoori was required to disclose the information as soon as possible, however no disclosure was made. The transfer occurred on 10 August 2016 following which the market speculated openly about the amount paid to Tejoori, which resulted in Tejoori’s share price rising by 38% on 22 and 23 August 2016. On 24 August 2016 Tejoori made an announcement which confirmed that the shares had been sold for no initial consideration. Tejoori’s share price closed 13% down on the day of the announcement.

The FCA concluded that Tejoori breached Article 17(1) of MAR because it did not release an announcement about its investment as soon as possible after being informed on 12 July 2016 that there was a reasonable expectation that it would be required to sell its shares for materially lower than Tejoori’s valuation of the investment. Tejoori traded on AIM between 24 March 2006 and 05 December 2017. Tejoori has now cancelled its admission to trading on AIM.

Click here to read the FCA’s Final Notice.