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‘Z’ CATEGORY COS

BSEC to appoint observer, auditor to restructure boards

Staff Correspondent | Published: 23:06, Aug 13,2020

 
 

The Bangladesh Securities and Exchange Commission on Thursday decided to appoint an observer and a special auditor to a company to restructure its board if the company has been in ‘Z’ category, which groups low-profile scrips, for more than two years and fails to restructure its board within 45 working days.

The restructured board would be given four years to revive the company’s business. In case of failure, the company would face forced delisting.

The BSEC also decided that trading settlement for the companies in ‘Z’ category would be T+3 instead of T+9.

Moreover, companies which will fail to provide cash dividend, fail to hold AGM and have net operating losses in two consecutive years, and will keep factory shut for more than six months would be sent to the ‘Z’ category.

The BSEC made the decisions at a commission meeting presided over by its chairman Shibli Rubayat Ul Islam, a BSEC press release said.

Shares held by sponsor-directors and current directors of companies in ‘Z’ category cannot be sold and transferred, it said.

The companies which are in the ‘Z’ category for more than two years, the boards of the companies must be restructured within 45 working days, otherwise the directors cannot continue as director of any other listed company and market intermediaries.

If the restructured board fails to improve the business of the company within four years, the DSE would delist the company and take legal actions.

All kinds of shareholding meeting including AGM/EGM must be held on digital platform or hybrid system with the facility of e-voting or online voting system.

The commission would soon annul the previous notification and issue new order in this connection.

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