Bula board likely to come under pressure as ISE seeks clarification

The board of Bula Resources is likely to come under pressure from the Irish stock exchange to clarify the situation regarding its finances after its shares remained suspended for a third day yesterday.

A spokesperson for Bula was unable to say why the company had been unable to issue a statement and could only say that a statement would be issued "as soon as is practicable".

Bula shares were suspended last Thursday and, as a result, the company's 40,000 shareholders are unable to deal in their shares.

A spokesman for the stock exchange would not comment. But market sources said that with the shares now going into their fourth day of suspension, the exchange will be looking for some urgent action from the company.

The source added that a company's shares could stay suspended for long periods when a major corporate event like a takeover is in progress. But in cases like Bula where the shares have been suspended pending a clarification of the financial system, the stock exchange does not like extended suspension as this is seen as acting against shareholders' interests.

Once the Bula directors - chairman and former Taoiseach Mr Albert Reynolds TD and chief executive Mr Tom Kelly - do issue their statement, the main focus will be on the status of the 50 million shares placed with the Ghaddafi International Charitable Foundation, a foundation headed by the son of Libyan leader, Col Moammar Ghaddafi, and particularly whether payment has actually been received for these shares.

Shareholders will also be looking for clarification of the status of the $1.5 million (€1.70 million) "refundable deposit" paid for an asset in Bahrain and also the renegotiated terms for the acquisition of an oilfield in the Gulf of Mexico. Other issues not directly related to the company's finances that will also need to be clarified include the continued absence of a stockbroker after the resignation of Davy.

Shareholders will also be looking for an update on the boardroom situation where there are only two directors. Bula itself has already conceded that this situation "is clearly not a tenable or desirable situation".