Home ›› 16 Jan 2023 ›› Stock
The Bangladesh Securities and Exchange Commission (BSEC), the securities regulator, suspended the primary subscription to the initial public offering (IPO) of Asiatic Laboratories Limited.
The drug maker’s primary subscription to the initial public offering was scheduled to begin today (Monday).
A BSEC source familiar with the matter said questions were raised from various ends about the real value of the company’s permanent assets. Besides, there has been complexity regarding the ownership of the drug maker.
BSEC spokesperson and Executive Director Rezaul Karim confirmed the matter to The Business Post saying that following several complications regarding the company’s wealth value and its ownership, the commission suspended the opening of its IPO subscription.
The stock regulator also formed a two-member probe body to look into the allegations raised against the company asking it to submit the report in seven working days.
The primary subscription to the initial public offering (IPO) of Asiatic Laboratories was slated to begin today and continue until January 22, when the drug manufacturer targets to raise Tk 95 crore.
According to the rules, the company was to issue IPO shares to individual investors, including NRBs, at a 30 per cent discount to the cut-off price or at Tk 20 each, whichever is lower.
The cut-off price was set at Tk 50 through bids by eligible investors, a requirement for the listing under the book-building method.
The pharma company received approval from the Bangladesh Securities and Exchange Commission (BSEC) on August 31 to explore the cut-off price.
From the IPO proceeds, Tk 58 crore would be spent on the acquisition and installation of machinery, Tk 6.14 crore on the construction of a factory building, and Tk 28 crore on the repayment of bank loans, alongside the IPO expenses.
As per the financial statements of the company for the year ended June 30, 2021, its net asset value (NAV) per share stood at Tk56.61 with revaluation, while the value is Tk35.48 without revaluation.
For the same period, the company’s earnings per share (EPS) stood at Tk3.65 and the weighted average of five years’ EPS is Tk3.21.
Accordingly, the price was fixed through electronic bidding by eligible investors between October 10 and October 13.
During this time, 221 eligible investors offered between Tk 20 and Tk 50 to buy a share of the Asiatic. Among them, 161 bidders offered the highest price -- Tk 50.
The company began operations in 1998 to manufacture, sell, and distribute pharmaceutical products. Shahjalal Equity Management is working as the issue manager for the IPO.
