Intracom’s shareholders approve change

Shareholders of telecoms equipment manufacturer Intracom yesterday approved a change in the way in which the company will use funds raised from share capital increases carried out two years ago. Intracom’s decision to divert the new proceeds to purposes different from those set out in the prospectus, landed its chairman, Socrates Kokkalis, in hot water last month. Following a probe by the crime squad SDOE, the prosecutor late last month slapped Kokkalis with a criminal fraud charge, alleging that he had misled investors on how funds raised from share capital increases executed in 2000 would be used. The rights issues involved Intracom and its subsidiaries, software supplier Intrasoft and electronic games manufacturer Intralot. The charge was in reference to 483 million euros which were not utilized by the end of 2000. He was also charged with three misdemeanors relating to breach of faith, the violation of stock market regulations and infringement of the law concerning listed companies. In his testimony, the Intracom head said he thought the deadline for using up the funds was 2004, rather than 2000. He also said the new uses for the funds had been approved by both the company directors and shareholders. Shareholders at yesterday’s extraordinary meeting gave the green light for the diversion of 104.5 million euros to investment activities already approved by the Athens Stock Exchange. The move came after the company decided to limit its activities in private financing projects, noting that such ventures had either been delayed or canceled. In addition, the trend has now turned toward vendor financing. Instead of spending 128 million euros, as originally projected in this sector, Intracom said it has cut the figure down to 11.7 million euros. Matching sums of money will be used for software and IT. Earlier this week, Intracom got shareholders’ approval for a share buyback of up to 10 percent of its equity over the next 12 months, in a move designed to shore up its share price which has been hit by the allegations surrounding Kokkalis. He also faces charges that include espionage, bribery and money-laundering. Intracom expects a 14-percent jump in consolidated sales this year and a 10-percent rise in group pretax profits, against a 16-percent and 7.8-percent increase respectively last year. Asked if more candidates could come forward, Rato told reporters: «Right now, it doesn’t look as if that will be possible, but in the end, it’s an agreement that has to be reached between everybody.»

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