Bashundhara wants to be strategic partner of Chittagong Stock Exchange

Bashundhara Group, one of the leading business conglomerates in the country, is keen to become a strategic partner of the Chittagong Stock Exchange (CSE).

The group has already submitted specific proposals to the port city bourse. The stock market regulatory body and the CSE are working on the proposal.

The Business Standard has obtained the documents of the proposal. But, no official of the CSE, Bangladesh Securities and Exchange Commission (BSEC) and Bashundhara Group is willing to comment on this as yet.

According to the proposal, ABG Limited, a concern of Bashundhara Group, wants to buy 25% shares of the CSE as a strategic partner. The company has offered a price of Tk15 for each share.

Bashundhara Group's Managing Director Sayem Sobhan Anvir is also the managing director of ABG Limited. The company is also trying to establish commodity exchange in the country with the CSE.

According to sources, the CSE sent Bashundhara's proposal to the BSEC on 1 August this year. The commission wrote back to the CSE on 17 August, seeking details of the proposal.

In a letter, the BSEC directed the CSE to provide detailed information about ABG Limited's resources, manpower, skills and investment capacity. Besides, the regulator asked the port city bourse to get shareholders' approval on the strategic partner and the proposed share price in its annual general meeting.

The BSEC and the CSE held a meeting on 24 August regarding these issues. The CSE will send the final proposal after duly fulfilling the instructions of the BSEC, sources said.

Sources said Bashundhara's top officials also held a meeting with the BSEC recently where they said ABG Limited is working in a joint venture with an America-based organisation for necessary technical support in managing the stock exchange.

Sources confirmed that the company has been asked to make a presentation to the BSEC about its future plans next Monday, 29 August.

According to the Demutualisation Act, there is an obligation to sell 60% of blocked shares among strategic, institutional and general investors.

Of those, 25% of the stock exchange's total shares will have to be sold to strategic investors.

After that, the remaining 35% will have to be sold to general and institutional investors through the initial public offering (IPO) process.

On the other hand, 40% of the shares are owned by members of the stock exchange or brokerage firms.

Since 2016, the regulator has been extending the time to look for strategic investors every year based on the company's applications.

Earlier, in September 2018, the Dhaka Stock Exchange (DSE) transferred 25% of its shares to strategic investors – the Chinese consortium of Shenzhen Stock Exchange and Shanghai Stock Exchange.

The DSE sold 25% of shares for Tk962 crore, with each share priced at Tk21.   

The CSE was established in 1995. Currently, its paid-up capital is Tk634.52 crore and the number of shares is 63.45 crore. It had paid a 4% cash dividend to its shareholders for the financial year 2020-21.

As of June 30, last year, the CSE's net profit was Tk28.34 crore, which was Tk31.88 crore in the previous year.

At the same time, its earnings per share (EPS) were Tk0.45 and its net asset value per share was Tk11.75.