Merchant bankers for completing whole IPO process within 82 days

Mohammad Mufazzal | Published: December 28, 2015 00:00:00 | Updated: February 01, 2018 00:00:00

Merchant bankers have proposed for completing the whole IPO (initial public offering) process within 82 days of getting regulatory consent to a company willing to go public under book building method. Â
Bangladesh Merchant Bankers Association (BMBA) made the proposal submitted to the Bangladesh Securities and Exchange Commission (BSEC) as part of the regulatory move to receive opinion on the revised public issue rules from the stakeholders.
The merchant bankers said they made the proposal of reducing timeframe considering the business viability of the eligible investors (EIs).
"As per the timeframe set for book building method, it will take above four months for a company to be listed after getting regulatory consent," said a merchant banker preferring anonymity.
He said foreign EIs make investments into companies making plan of getting returns.
"Sometimes, business plans are changed due to possible modificationsÂ brought in different policies including the taxation one. That's why specific timeframe is required for ensuring returns in business," said another merchant banker.
On December 7 last, the securities regulator approved the amendment brought to public issue rules for book building and fixed price method.
In the revised public issue rules, the securities regulator has not specified the timeframe of starting bidding for eligible investors.
In that case, the BMBA has proposed to start bidding within 10 days of receiving regulatory consent to the IPO proposal submitted under book building method.
The BMBA has also proposed to give consent for general public within five days of receiving report from the issuer. In that case, the BSEC has mentioned timeframe of giving consent for general public.
The securities regulator has included the provision of opening subscription after 25 days of publication of abridged version of prospectus. In that case, the issue managers have proposed for opening subscription after 10 days of publication of abridged version of prospectus.
As per revised public issue rules, the subscription will remain open for 25th working days of publication of abridged version of prospectus. As per the BMBA proposal, the subscription should remain for five consecutive business days instead of 25 working days of publication of the prospectus.
"General public will apply only for 30 per cent of total size of the IPO. So, five business days are enough for public subscription," said the merchant banker.
As per the securities regulator, the lottery will have to be completed within 18 working days of subscription. The BMBA has proposed 24 days for completing the lottery.
The BMBA has also made another proposal of staring the listing and debut trading of the company within 16 days of subscription instead of 30 working days set in revised public issue rules.
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