BSEC's queries on Chinese bid
DSE board asks officials to reply 'professionally'
FE Report | Thursday, 1 March 2018
The Dhaka Stock Exchange (DSE) board of directors has asked its management to give reply 'professionally' to the regulator's queries on the Chinese consortium's proposal to be the bourse's strategic partner.
The board's advice came at a meeting on Wednesday, a day after the Bangladesh Securities and Exchange Commission (BSEC) sent a letter to DSE, seeking explanation on some clauses, mentioned in the Chinese consortium's proposal.
"The issue of replying the regulator's letter was discussed in the meeting along with other agenda. The board asked the management to reply to the queries professionally," said a meeting participant.
While asked, DSE Managing Director K A M Majedur Rahman said the bourse's replying to the queries of the securities regulator is a routine work.
"We are preparing our reply for sending to the securities regulator within the given timeframe," he added.
BSEC sent the letter to the premier bourse on Wednesday, seeking explanation on some clauses of the Chinese consortium's proposal. DSE will have to submit its explanation to BSEC by March 4.
After getting the DSE reply, a four-member BSEC committee will submit appraisal report to the commission. Then the regulator will give its decision on selection of strategic partner of DSE.
According to BSEC officials, some clauses of the Chinese consortium's bid are 'contradictory' with the country's laws.
They said the consortium has set the condition of signing the share sale agreement as per the UK laws. The disputes, if any, will have to be solved in accordance with the UK arbitration rules.
BSEC said DSE will require bringing some changes in its articles of association thorough annual general meeting to abide by some other conditions, mentioned in the Chinese proposal.
The consortium also set the condition of suspending and scrapping the exchange's settlement guarantee fund contribution.
Besides, DSE will require approval of the Chinese consortium in case of inclusion of a new director as well as taking decision on more than 15 per cent shares of DSE.
On February 10, DSE approved the proposal of Chinese Consortium, comprising Shenzhen Stock Exchange and Shanghai Stock Exchange, which offered Tk 22 per share for 25 per cent of the total shares of DSE.
The consortium also offered technical support worth US$37 million to DSE.
BSEC has also sought the exchange's 'neutral' assessment on the technical offer, placed by the proposed strategic partner.