The Bangladesh Securities and Exchange Commission has declined a Baraka Power Limited’s proposal to raise its capital base through issuance of preference shares for non-compliance with joint shareholding rules.
The company informed the Dhaka Stock Exchange that the BSEC on May 31 declined to approve the proposed increase of capital of the company through issuance of preference shares due to breaching securities laws related to mandatory 30 per cent joint shareholding by sponsor-directors.
The sponsor-directors of Baraka Power hold 18.93 per cent of the company’s paid-up capital while public and institutional investors hold 56.14 per cent and 24.93 per cent respectively, according to the data available on the DSE web site.
On October 30, 2017, the company informed the DSE that it had decided to issue 8,00,00,000 non-listed, non-convertible, cumulative, redeemable preference shares of Tk 10 each amounting Tk 80 crore through private placement for meeting financing needs of the company.
The company had also decided that the preference shares would be issued with a tentative annual dividend rate ranging from 8 per cent to 9 per cent having redemption period ranging from 5 years to 7 years.
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