FAR Chemical IPO approved

The securities regulator Tuesday approved the IPO (initial public offering) proposal of FAR Chemical Industries which will raise a fund worth Tk 120 million under fixed price method, officials said.

The regulator has also fined the Barkatullah Electro Dynamics Tk 0.1 million as its one director has failed to comply with the directive of holding minimum two per cent shares of the company's paid-up capital.

The decisions were taken at a commission meeting held at the office of the Bangladesh Securities and Exchange Commission (BSEC).

As per the regulatory decision, the FAR Chemical Industries will offload 12 million ordinary shares at an offer price of Tk 10 each.

The company will raise a fund a worth Tk 120 million to purchase capital machinery and boost the expansion capacity.

As per the financial statement for the year ended on June 30, 2013 the company's earning per share (EPS, basic) and net asset value (NAV) are of Tk 5.01 and Tk 15.55 respectively.

The BSEC has fined the Barkatullah Electro Dynamics Tk 0.1 million as one director of the company failed to hold minimum two per cent shares.

Farhad Ahmed, a BSEC executive director, said all existing directors of listed companies, other than one of Barkatullah Electro Dynamics, have minimum two per cent shares of their respective companies.

"As per the BSEC notification, any director, other than independent directors, must hold minimum two per cent. In no way he/she will be able to stick to board without holding two per cent shares," said Mr. Ahmed.    

When asked, whether there is any director in boards of the listed companies without holding minimum two per cent shares Mr. Ahmed said, "As per our observation, there is no director in the boards of listed companies without fulfilling the requirement."

The securities regulator has also warned 16 other listed companies as the companies did not inform the regulator about the qualifying status of their directors in time.

On November 22, 2011 the securities regulator issued a notification stating that each director other than independent director (s) of any listed company shall hold minimum two per cent shares of the paid up capital, otherwise there shall be a casual vacancy of director.

And in case of aforesaid casual vacancy of director, any individual holding five per cent or more shares of the paid up capital shall be entitled to be a director in the next Annual General Meeting (AGM).