The stock exchange used its powers to block fund-raising exercises for only the second time when it banned a planned issue of 120 million new shares by Honko International Holdings, stock exchange sources said.
The issue was to have completed a deal made in August between Honko and telecommunications equipment provider CCT Telecom.
Terms of the deal were that CCT would take 25 per cent of Honko's enlarged capital in return for sale of its manufacturing unit, Electronic Sales, to Honko for $120 million.
Under this agreement, Honko needed to issue 120 million new shares to CCT at $1 each, meaning that CCT would reap an $80 million profit from the deal.
The exchange source said the deal was rejected because proper disclosure requirements had not been followed.
On Sunday, CCT said the deal collapsed because Honko failed to gain stock exchange permission to issue the new shares.
CCT added that its expected $80 million profit would not materialise.