BSEC won't receive new IPO proposal before amendment of public issue rules
Norfund to buy 63.70m shares of MTB
FE Report | Wednesday, 1 May 2019
The securities regulator has decided not to receive any new IPO (initial public offering) proposal before publishing the proposed amendment of the public issue rules.
The decision was taken on Tuesday at a meeting held at the office of the Bangladesh Securities and Exchange Commission (BSEC).
As per Tuesday's decision, the BSEC will not receive any new IPO proposal from April 30 last.
On the other hand, the IPO proposals submitted before April 29 will be considered as per the existing public issue rules.
The regulatory decision came as part of some market supportive measures taken following the recent tumble of share prices.
The securities regulator took the measures as per the instruction of the Prime Minister Shiekh Hasina delivered on Sunday at a meeting held at her office.
Finance Minister, the governor of the central bank and the chairman of the BSEC attended the meeting.
The BSEC will bring further amendment to the public issue rules setting new ceilings of capitals to be raised through IPO.
As per the BSEC decision, an issuer company will have to raise a minimum capital of Tk 500 million under the fixed price method.
On the other hand, the minimum IPO size will be Tk 1.0 billion under the book building system.
Besides, no prior permission would be required from the BSEC for issuing shares under private placement.
That's why the securities regulator will receive no proposal of issuing pre-IPO placement shares from April 30.
The proposals submitted before April 29 for issuing pre-IPO placement shares will be considered as per the existing rules.
At Tuesday's meeting, the securities regulator also approved the proposal of expanding paid-up capital by Mutual Trust Bank (MTB) by issuing shares to Norfund, a foreign investment fund, owned by the Norwegian government.
MTB will issue above 63.70 million shares, which is 10 per cent of paid-up capital, to Norfund.
On Tuesday, the securities regulator also approved the proposal of Tk 3.0 billion zero coupon bond to be issued by the Delta Brac Housing Finance Corporation. The tenure of the bond will be five years.