Market-maker first for Lithuania

  • 2007-10-17
  • Staff and wire reports
VILNIUS - Dairy products producer Vilkyskiu Pienine, one of the most technologically advanced cheese makers in Lithuania, has signed a market-making contract with Orion Securities brokerage. The market-making services are to be launched on Oct. 29.
"Market-making is a tool for improving share liquidity and market depth. Market-making is a usual practice on foreign stock markets, whereas in Lithuania, Vilkyskiu Pienine will be the first company ever to make use of this service," said Karolis Rukas, head of the finance department at Orion Securities.

According to the US Securities and Exchange Commission, the "market-making" firm is one that stands ready to buy and sell shares of a particular company on a regular and continuous basis at a publicly quoted price. Most often market-makers are referred to in the context of Nasdaq and other over-the-counter exchanges. They keep markets operating at times, for instance, of crisis, when markets freeze up due to a lack of buyers.
Stocks can have more than one market-maker. Market-makers generally must be ready to buy and sell at least 100 shares of a stock they make a market in. As a result, a large order from an investor may have to be filled by a number of market-makers, at potentially different prices.

Vilkyskiu Pienine should expect to see its share prices trade slightly higher, as increased liquidity means investors are more easily buying and selling shares, making the stock less unattractive to hold.
Orion Securities has already applied to the Vilnius Stock Exchange (VSE) concerning the inclusion of the dairy firm onto its market-making lists. Vilkyskiu Pienine will be the first VSE-quoted company to make use of market-making services for its stocks, Orion Securities said.
Vilkyskiu Pienine reported 27.8 million euros in sales for the first nine months of 2007, up by 23.4 percent from the year-earlier figure.

For the entire group, which includes Modest, its mozzarella cheese production subsidiary, full year figures for 2007 are projected to show consolidated net profit growth of 28.2 percent, to 1.45 million euros, with revenues rising by 16.6 percent to 39.1 million euros.
Vilkyskiu Pienine, which is quoted on the I-List of VSE, is 64.33 percent owned by its CEO, Gintaras Bertasius. The dairy producer is based in Vilkyskiai, in western Lithuania.
Orion Securities is the market-making leader on the Oslo Stock Exchange.