The stock market regulator on Tuesday issued a directive on exit plan for issuers of the delisted securities in the interest of the investors and the capital market.
The Bangladesh Securities and Exchange Commission (BSEC) asked the authorities concerned to comply with the directive issued under section 20A of the Securities and Exchange Ordinance 1969.
The authorities are: Dhaka Stock Exchange, Chittagong Stock Exchange, Central Depository Bangladesh, the issuer of delisted securities or issuer of delisted securities trading at over the counter (OTC) platform or at the alternative trading board.
According to the directive, any securities delisted from the main board of the stock exchanges, or any de-listed securities trading at the OTC market, or any securities trading at alternative trading board or any other securities as directed by the commission shall apply for exit plan.
It said the companies, which are not in commercial operation for more than two years, or the applicant has made a net loss for three consecutive years, if the accumulated loss or debit balances of retained earnings exceed its paid-up capital or if the applicant failed to declare any dividend for consecutive three years or if the applicant failed to hold an annual general meeting for consecutive three years may apply for the exit plan.
If the applicant failed to make payment of interest or coupon or profit of any debt securities for consecutive three scheduled period, or if the applicant failed to make repayment or redeem of the principal of any debt securities as final settlement or for consecutive two scheduled installments of principal.
If the issuer of securities involved in money laundering or terror financing activities or involved in the illegal drug business, the commission asked the issuer to apply the exit plan by delisting its securities from the stock exchanges.
The commission deserves the right to allow or disallow any application, said the BSEC directive.
For the exit plan, the offeror alone, or along with the concert party shall be in an agreement or a contract with the applicant with regard to offer for buying securities from the shareholders or securities holders other than the offeror and concert party, according to the directive.
The stock exchanges shall take necessary action to suspend the trade of securities of the applicant if traded at the OTC platform or ATB immediately after receiving the information, the directive said.
The commission shall accord its consent or issue a rejection letter within 30 working days after receiving the application.
The stock exchanges shall resume trading of the aforesaid securities at the respective trading system within seven working days after rejection of the exit plan by the commission, it said.
The commission reserves the right to accept or reject or engage and enforce any exit plan application or proposal in its own direction in the greater interest of the investors and capital market as well, said the BSEC directive.
The applicant shall pay an amount of Tk 100,000 (non-refundable) as application fee in favour of the BSEC.
The offer price for buying securities under the aforesaid exit plan shall be any of the following whichever is higher, like face value or issue price at the time of IPO, or last trade price, or net asset value per share as per the last audited financial statement, or volume-weighted average price for one year immediately preceding the date of suspension or date of delisting as applicable, according to the directive.
“Provided that the offer price for buying securities under the exit plan shall be the issue price as the time of IPO in case of such securities traded below the par or face value subject to the approval of the commission,” it said.