Brummer & Partners to exit from Runner Auto

The securities regulator has approved a proposal of wavering from a three years lock-in period to two years for the Runner Automobiles’ shares held by the Brummer Frontier PE II Limited—a fund managed by Brummer & Partners Asset Management (Bangladesh).

The approval allowed the fund manager, a subsidiary of Sweden’s largest hedge fund manager Brummer & Partners, to sell off its entire shares or 24.93 per cent in Runner Auto.

Lock-in period is a predetermined amount of time following an initial public offering where large shareholders are restricted from selling their shares.

On Wednesday, the securities regulator approved the proposal forwarded by Brummer & Partners Asset Management on June 27 this year.

After staying as an investor for eight years, it now wants to exit the company by selling its shares gradually, said an executive at Brummer & Partners.

Sources said the Brummer Frontier made an equity investment of Tk 105 crore through buying 13,478,261 shares at an issue price of Tk 77.91 each in 2013. The number of shares now stands at 28,304,347 after the company declared a bonus dividend for shareholders.

Runner’s paid-up capital is worth Tk 113.5 crore and has 11.35 crore in outstanding shares. Shares of the company traded at Tk 53.70 each on Sunday.

On May 21, 2019, Runner Automobiles debuted on the stock exchanges after raising Tk 100 crore through IPO.

Runner Automobiles Director and also Brummer & Partners (Bangladesh) CEO Khalid Quadir was not available for comment.

Runner Automobiles, as the country’s maiden automotive manufacturer, holds 90 per cent of the market share in the sub-100cc motorcycle category, 37 per cent in commercial vehicles, and 26 per cent in three-wheelers.

The company exports Made in Bangladesh motorcycles to Nepal and Bhutan. It also has a plan to widen its export destinations to Africa and Southeast Asia.

Runner has a facility in Bhaluka, with a production capacity of 100,000 motorcycle units per year. The company manufactures motorcycles under the ubiquitous “Runner” brand.

Sponsor-directors hold 50 per cent shares of Runner whereas Brummer holds 24.93 per cent or 28,304,347 shares, according to the latest annual financial report of Runner.