The record date for entitlement of Sonali Paper & Board Mills' rights share is set on May 23 while subscription will begin on June 7.
The subscription period for the company's rights share will continue until June 28, aiming to raise Tk 109.82 million through rights issuance, according to a disclosure on Sunday.
The rights issue is an offer of new shares by a company to its existing shareholders in proportion to the shares they already own and usually at a discount to market price.
The stock market regulator -- Bangladesh Securities and Exchange Commission (BSEC)--approved Sonali Paper's application last Wednesday to raise Tk 109.82 million through rights issuance.
As per the regulatory approval, the company will issue more than 10.98 million rights shares of Tk 10 per share for raising the said amount.
The company will issue one rights share for existing two shares held (1R:2).
The purpose of issuance of rights share is to purchase brand new Caterpillar Gas Generator sets with complete standard accessories, said the company.
The company will not be allowed to increase its paid-up capital by issuing bonus shares in the next five years and sponsor-directors shares will be locked-in for three years, according to BSEC approval.
The company has posted a massive 578 per cent increase in its profit for July-December 2021 compared to the same period of the previous year.
Its earnings per share (EPS) jumped to Tk 11.67 for July-December 2021 as against Tk 1.72 for July-December 2020.
The net asset value (NAV) per share was Tk 246.95 as on December 31, 2021 and Tk 236.94 as on June 30, 2021.
The company disbursed 20 per cent cash and 20 per cent stock dividend for the year ended on June 30, 2021.
UCB Investment Ltd is working as issue manager of the company's rights offer.
The company's share price, however, fell 3.85 per cent to close at Tk 834 on Sunday. Its shares traded between Tk 195.60 and Tk 959.90 in the last one year.
Earlier, the stock market regulator has relaxed a rule relating to issuing right shares of the Sonali Paper to comply with the regulatory obligation to maintain a minimum paid-up capital of Tk 300 million.
Currently, the company's paid-up capital is Tk 219.63 million while authorised capital is Tk 500 million and total number of securities is Tk 21.96 million.
Sponsors hold 67.51 per cent stakes in the company, institutions 12.40 per cent and the general public the remaining 20.09 per cent as of March 31, 2022, according to DSE data.
Sonali Paper & Board Mills was incorporated in 1977 and got listed on the Dhaka Stock Exchange in 1985 and on the Chittagong Stock Exchange in 1996.
Under the previous management, the company had incurred huge losses and failed to provide financial statements and hold annual general meetings from 1998 to 2006.
Younus Group took over the company after buying all shares in 2006.
Accordingly, the prime bourse transferred the company to the over-the-counter (OTC) market in October 2009 due to poor performance.
Sonali Paper came back to the main board of the stock exchanges from the OTC market on July 26, 2020.
babulfexpress@gmail.com
