Bangladesh Securities and Exchange Commission (BSEC) has approved the country's first SME IPO (Small and Medium Enterprise Initial Public Offer) in favour of Nialco Alloys Limited (NAL) to raise a fund of Tk 7.50 crore.
The approval was given at a commission meeting held on Thursday at its headquarters.
The Commission Chairman Professor Shibli Rubaiyat-Ul Islam presided over the meeting, said a BSEC statement.
Under the fixed price method by qualified investors, Nialco Alloys will offload 75 lakh ordinary shares for Tk 10 each.
Net proceeds from the IPO will be used to buy machineries, land development and meet IPO expenses.
According to the financial statement ending September 30, 2020, the company's net asset value (NAV) per share was Tk 12.43, while earnings per share (EPS) were Tk 0.91.
MTB Capital Limited will act as the issue manager for the IPO process.
The company will not be able to issue any bonus shares for the next three years from the share trade on the SME platform.
To accelerate the growth of small-cap companies, the securities regulator formulated rules titled 'Bangladesh Securities and Exchange Commission (Qualified Investor Offer by Small Cap Companies) Rules, 2018.
After raising capital through a qualified investor offer (QIO), a company's paid-up capital will be at least Tk 5 crore and the figure would not cross Tk 30 crore.
The Chattogram-based Nialco Alloys was incorporated in 2011. The principal activities of the company are to manufacture high-grade Bronze and Brass Ingots including Gun Metal, Phosphorus Bronze, Leaded Bronze, Aluminum Bronze, Manganese Bronze, Sand Cast Brass (SCB), High Tensile Brass (HTB), Die Cast Brass (DCB), Master Alloys, Phosphorus Copper, etc.
The Commission also approved the draft prospectuses of RBIMCO BGFI fund. The initial size of the Fund will be Tk 10 crore.
The sponsor will contribute Tk 1 crore while the remaining Tk 9 crore will be collected through sales of units of Tk 10 each.
Royal Bengal Investment Management Company Ltd (RBIMCO) is the fund manager of the fund.
