BSEC rejects Safko Spinning rights offer

The securities regulator has turned down the rights offer of Safko Spinning Mills Limited (SSML) for its failure to meet the securities rules concerned, officials said.

The officials of the Dhaka Stock Exchange (DSE) said they received a letter from the Bangladesh Securities and Exchange Commission (BSEC) in this regard.

According to the news posted on the DSE website on Wednesday: "BSEC is not in a position to consider the application of Safko Spinning Mills Limited for issuance of rights shares, as the Company has failed to comply with the Condition No. 3(e) of the Securities and Exchange Commission (Rights Issue) Rules, 2006."

According to the section 3(e) of the Securities and Exchange Commission (Rights Issue) Rules, 2006, an issuer of a listed security may make rights issue by issuing rights share offer document, if the financial statement of the company is prepared as per International Accounting Standard (IAS) as applicable in Bangladesh, and audited as per IAS as applicable in Bangladesh.

According to the news posted on the DSE website on March 10, 2014, the SSML board of directors decided to issue three rights shares against two existing shares at an issue price of Tk 10.00 each.