Beximco Synthetics seeks delisting from stock market

The stock market regulator suspended share trading of Beximco Synthetics after the company applied for delisting from the stock exchanges due to incurring losses for years.
The securities regulator ordered Dhaka Stock Exchange (DSE) and the Chittagong Stock Exchange (CSE) to suspend trading of the company' shares from Tuesday.
The trading of the shares of Beximco Synthetics was suspended from Tuesday for the interest of the investors, securities market as per regulatory order, according to a DSE web posting on Tuesday.
The Bangladesh Securities and Exchange Commission (BSEC) suspended trading of the shares of the company so that no one could manipulate prices of the company's shares, said a BSEC official.
Regarding trading suspension of the company's shares, the BSEC asked the bourses to comply with provision 9(7) of the securities ordinance, 1969.
According to the provision, the suspension of a company would be for a period of thirty days. The stock exchanges could extend the suspension period by 15 days each time.
Suspension would continue to be extended by 15 days until the regulator makes a decision of delisting of the company or gives any other direction regarding the issue, the BSEC official said.
He said that the company had recently applied to the BSEC, seeking the delisting and the company's sponsor-directors would buy back its shares from the general investors.
The BSEC would formulate a policy regarding voluntary delisting of a company and settling the investors' interest.
The commission may set a price for the sponsor-directors to buy shares of the company, which could be higher than the current market price so that investors' interest could be upheld, he added.
Share prices of Beximco Synthetics, a polyester filament yarn manufacturer, closed at Tk 8.50 per share on Monday.
The company's total number of shares is 86.71 million. Sponsor-directors own 35.67 per cent stake, the institutional investors own 17.93 per cent, foreign investors 0.02 per cent and the general public 46.38 per cent as on July 31, 2020.
Beximco Synthetics has been incurring losses for years and failing to provide dividend to its shareholders. So, shares of the company had been trading under the 'Z' category for long.
Beximco Synthetics was among the 15 companies which are being reviewed by the DSE as they have been incurring losses for more than five years.
The BSEC has recently asked the companies under the 'Z' category to restructure their boards within 45 days from the day of their placement in the category.
If the companies fail to do so, the commission would appoint an observer and a special auditor to restructure the companies' boards.
As per the BSEC decision, the directors of the companies under the 'Z' category would be barred from holding directorship in any other company or institution connected with the stock market.
The Beximco Synthetics was listed with DSE and CSE on 4th November 1993 and 6th November 1995 respectively.
The company made good profit and declared dividend from 1996 to 2013 for 18 years without any interruption, the company said in a press release on Tuesday.
The company failed to declare dividend in the last seven years since 2013due to accumulating huge losses.
Finally, the company was forced to close down the plant. It retrenched all the workers and most of the officers and staffs after paying all their dues as per law.
Then the board of directors decided to delist itself from the DSE and CSE.
Since there are no clear rules for a company to delist from the stock exchanges, the company has written to BSEC for guidance in this matter, said the press release.

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