Renata to issue Tk325cr preference shares

Renata Limited, a leading pharmaceutical company, plans to raise Tk325 crore through the issuance of preference shares to partially repay its outstanding loans and borrowings.

According to a statement on the stock exchange, the preference shares will be redeemable, cumulative, non-convertible, and non-participative.

To secure shareholder approval, the company has scheduled an ordinary general meeting for 12 January, with the record date set for 12 December.

As of September, Renata's total loans and borrowings, including current and non-current liabilities, amounted to Tk1,550 crore, according to its unaudited financial statement for the July-September quarter.

The preferred shares will not be added to the company's ordinary shares and will not be counted in its earnings per shares (EPS).

Preference shares entitle shareholders to receive dividends before ordinary shareholders.

While preference shareholders are not considered company owners, they have priority over ordinary shareholders regarding dividend payments and redemption rights in the event of bankruptcy.

On 14 March, the Bangladesh Securities and Exchange Commission (BSEC) approved Renata's plan to issue preference shares worth Tk350 crore through private placement for five years.

In January, the regulator also permitted the company to issue a zero-coupon bond worth Tk660 crore.

During the first quarter of this fiscal year, Renata reported a consolidated revenue growth of over 7%, reaching Tk1,017 crore. However, consolidated net profit dropped by 42% to Tk59.50 crore compared to the same period last year.

In September, the board recommended a 92% cash dividend for shareholders for the last fiscal year. The company will hold its annual general meeting on 5 December via a digital platform to approve the dividend and the audited financial statement.

Renata's shares closed at Tk633.10 on Sunday, down 1.09% from the previous session at the Dhaka Stock Exchange.