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BSEC gives nod to 2nd SME IPO

  • Published at 06:41 pm July 1st, 2021
Mostafa Metal

This makes Mostafa Metal the second SME after Nialco Alloys Limited (NAL) to go public

The Bangladesh Securities and Exchange Commission (BSEC) has given its approval for another small and medium enterprise (SME) to enter the stock market.

The stock market regulator on Wednesday instructed to issue Tk11 crore worth of ordinary shares in favour of Mostafa Metal Industries Ltd.

This makes Mostafa Metal the second SME after Nialco Alloys Limited (NAL) to go public.

The organization will raise funds for bank loan repayment, working capital and issue management costs with a face value per share of Tk10 to investors.

Also Read - Bangladesh's first SME IPO's rakes in 134C against 7.5C demand

According to a BSEC circular, eligible investors will be sought through Qualified Investor Offer (QIO) as per Bangladesh Securities and Exchange Commission (Qualified Investor Offer by Small Capital Companies) Rules, 2018.

Additionally, the issuing company will not be able to issue any bonus shares for the next three years from the date of transaction on the SME platform.

NBL Capital & Equity Management Limited and Swadesh Investment Management Limited will be working as the issue managers.

Meanwhile, the commission also approved IFIC Bank Limited's proposal of a Tk500 crore unsecured, non-convertible, floating subordinate bond.

Through the raised capital the bank will strengthen its capital base.

The face value of the bond will be Tk1 crore per unit, for which Kalyan Insurance Company Limited and Standard Chartered Bank will act as the arranger and trustee.

The floor coupon rate of subordinated bonds is 7.5% and a ceiling of 10.5%, which is applicable to financial institutions, mutual funds, insurance companies, listed banks, cooperative banks, regional rural banks, organizations, trusts, autonomous corporations and other eligible investors. The bonds will be issued through private placement.

The commission also approved the request of issuing a certificate of registration as Resource Manager to Sandhani Asset Management Limited.

Prof Shibli Rubaiyat-Ul-Islam, chairman of BSEC, presided over the commission meeting.