The Dhaka and Chittagong stock exchanges have sought another one year time to the Bangladesh Securities and Exchange Commission to get strategic investors for the demutualised-bourses as the entities failed to reach in any final agreements with the stipulated time.
On December 9, 2015, the BSEC under the Demutualisation Act, 2013 directed the DSE and the CSE to get strategic investors within a year that ended last week. The two bourses became demutualised on November 21, 2013 as per the recommendation of capital market investigation committee on 2010-11 market crash to separate their management from ownership.
‘We have given a letter to the commission seeking another one year to get strategic investor for the bourse as the process is yet to be finalised,’ CSE managing director Md Saifur Rahman Mozumder told New Age on Saturday.
‘We have communicated with a number of local and foreign investors after the BSEC’s instruction but are yet to reach to the final stage,’ he said.
‘That’s why, we have given an application to the commission for another one year time in this regard,’ Saifur said.
A BSEC senior official told New Age, ‘Both the bourses have submitted their applications in this regard. The commission, however, is yet to make any decision in this regard.’
‘We will examine their reports on the progress of the bourses in finding strategic investors before making our decision,’ he said.
The DSE signed a memorandum of understanding with three organisations including one foreign organisation and two local entities to start the process of selling stakes to strategic investors.
The CSE, on the other hand, signed a memorandum of understanding with state-owned Investment Corporation of Bangladesh as part of the process.
According to the demutualised scheme of the stock exchanges, the DSE consists of 180,37,76,500 shares and the CSE 63,45,24,840 shares of Tk 10 each considering Tk 1,803.77 crore and Tk 634.52 crore paid-up capital of the entities.
Under the directive, the DSE and the CSE will be allowed to float the highest shares worth around Tk 609.57 crore for their strategic investors considering face value at Tk 10 for each share.
The DSE will have to float shares worth Tk 450.94 crore, while the CSE Tk 158.63 crore. The bourses will be allowed to sell the rest 35 per cent of the 60 per cent shares to general investors through initial public offerings under the book-building method.
Out of the total shares of the entities, 40 per cent shares were kept for initial shareholders.
The number of initial shareholders of the DSE and the CSE are 250 and 148 respectively.
Addressing a function on July 16, 2016, BSEC chairman M Khairul Hossain said unless any significant progress was made, allowing more time for the purpose of finding strategic investors would not be possible for the commission.
As per the demutualisation rules, the commission may allow the bourses more time for finding strategic investors if they fail to find strategic investors within one year.
The shares, which are kept for strategic investors, can be allotted to other individuals with prior approval from the commission if any exchange fails to sell shares to any strategic investor.
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