SEC okays IPO of Rangpur Dairy, rejects CDBL’s proposal

FE Report

Securities regulator after its restructuring, approved first initial public offering (IPO) of a company— Rangpur Dairy— but disagreed with IPO proposal of Central Depository Bangladesh Limited (CDBL) on sensitivity ground on Tuesday, officials said.

The decision came at a commission meeting, chaired by Securities and Exchange Commission (SEC) chairman Professor M. Khairul Hossain, held at the SEC office.

As per regulatory approval, Rangpur Dairy and Food Products will offload more than 16.3 million ordinary shares of ten taka each, at an offer price of Tk 18, including a premium of Tk 8.

The company’s existing paid-up capital is more than Tk 236.5 million. The company’s earning per share (EPS) and net asset value (NAV) are Tk 0.88 and Tk 16.97 respectively, according to financial statement of January-April, 2010.

The policy makers of recast SEC at first approved the IPO of a mutual fund—LR Global Bangladesh Mutual Fund One— at its previous meeting.

SEC Spokesman Mohammad Saifur Rahman said the securities regulator has disagreed with the IPO proposal of CDBL considering its sensitivity ground.

“CDBL preserves information of electronic shares of all listed companies. That’s why steps have taken to keep the company above controversy,” Mr. Rahman said.

Meanwhile, the leaders of both the bourses opposed the move to CDBL listing on the same ground at a meeting held with securities regulator.

They opined that investors would raise questions against this sensitive organisation if the company fails to carry out regular activities including annual general meeting (AGM) and dividend offers properly.

“The regulator has not agreed with the listing proposal of CDBL, considering overall situation,” SEC spokesman said.

After the recent stock market debacle, the government completed the overhauling in SEC by appointing Chairman Professor M Khairul Hossain and three members—Professor Helal Uddin Nizami, Md. Amzad Hossain and Arif Khan in May, 2011.

Newly recast securities regulator adopted a cautious approach to approve new IPO proposals as the recent stock crash prompted its high ups to take time to scrutinise the proposals and examine their financial details.

Presently, thirteen firms are awaiting regulatory approval to raise about three billion taka from the market through fixed price method.

The companies include Surid Industries, Jahintex, Energy Prima, Aamra Technology, Crystal Insurance, GSP Finance and Padma Islami Life Insurance.

Source: The financial express, 06 July, 2011
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