The securities regulator has rejected Gemini Sea Food's rights offer application, which aimed to issue rights to increase its paid-up capital, pay off loans, and support business expansion.
In February this year, the board of directors of the seafood exporter had decided to raise Tk 1.28 billion through issuing 21.3 million rights shares.
"The Bangladesh Securities and Exchange Commission (BSEC) is not in a position to give consent to the company for raising capital through issuance of right shares," said the company in a regulatory filing on Thursday.
However, the company did not mention any reasons as to why the regulator rejected its application.
Company secretary AFM Nazrul Islam could not be reached for comments.
Despite the news, its stock price rose 1.54 per cent to close at Tk 230.4 on Thursday on the Dhaka Stock Exchange.
Gemini Sea Food had applied for issuing two rights shares against existing one ordinary share with an offer price of Tk 60, including Tk 50 as a premium.
Following the news, its stock price had doubled in a span of three months between February and May 2023 to reach Tk 934 before going down.
The rights issue is an offer of new shares by a company to its existing shareholders in proportion to the shares that they already own and usually at a discount to the market price within a stipulated time.
Currently, the company's paid-up capital is Tk 106.84 million while authorised capital is Tk 400 million.
Gemini has been the pioneer in exporting certified organic shrimp from Bangladesh to EU retailers since 2008. The company exports quality products to the European Union, Canada, USA and Japan.
In March last year, the frozen shrimp and fish exporter, entered into a deal with Lenk Frozen Foods (Asia) Company, a German-based company, to boost shrimp exports.
Despite the deal signed, Gemini Sea Food's revenue dropped 7.66 per cent year-on-year to Tk 615 million in nine months through March this year.
The frozen food exporter's net profit also plunged 24 per cent year-on-year to Tk 74 million through March this year.
Meanwhile, the regulator formed a panel to investigate the financial disclosures of Gemini Sea Food following the discovery of 'inflated revenue figures" during a preliminary inquiry by the Dhaka bourse.
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