The authority of Mobil Jamuna Lubricants (MJL) Bangladesh has lowered price of each share by Tk 37.40 to Tk 115 paving the way for listing it on the stock exchanges in order to protect investor’s interests.
The decision came from a meeting between the board of directors of the Dhaka Stock Exchange (DSE) and Azam J Choudhury, managing director of MJL at DSE on Wednesday.
“We decided to enlist MJL considering the interest of investors as well as the stock market,” DSE president Shakil Rizvi said at a press conference in the evening after the meeting.
He also said the share trading of the company will start within the next two weeks after completing all formalities.
“We decided to enlist MJL considering the interest of investors as well as the stock market,” DSE president Shakil Rizvi said at a press conference in the evening after the meeting.
He also said the share trading of the company will start within the next two weeks after completing all formalities.
DSE management will declare the date for trading of the share after receiving clearance from the Securities and Exchange Commission (SEC) and written assurance from MJL that they have refunded money to all investors, he added.
The DSE will send a letter to the SEC requesting the market regulator to withdraw its previous directives to enlist MJL on condition of compensation.
“The MJL authorities lowered indicative prices of share to protect investor’s interest and share market,” said Azam J Choudhury. He said “we fixed indicative price at Tk 115 and the rest Tk 37.40 per share will be refunded to primary share holders.
Choudhury informed that the current price earnings ratio (PE) of MJL shares is 16.81 instead of Tk 6.84.MJL offloaded 40 million ordinary shares of Tk 10 each at an offer price of Tk 152.40, using the book building method.DSE vice president Ahmed Rashid Lali termed the decision as epoch making. He also said that the DSE requested the management of the company to bring down offer price considering investors interest and the accepted our request.
Earlier, the DSE denied listing of MJL saying that the company’s proposal of giving compensation does not comply with company act. They also said that the share price of the company is overvalued and it would push investors to lose money.
The MJL authorities earlier proposed to offer 200 percent cash dividend and compensate at least Tk 10 if share value go bellow offer price.
Earlier, leaders of Dhaka and Chittagong stock exchanges recently met SEC Chairman M Khairul Hossain to resolve complexity over the listing of MJL and asked to take necessary steps.
The country’s twin bourses decided in principle to enlist MJL without SEC’s directives if compensation proposal is expectable.
The country’s twin bourses decided in principle to enlist MJL without SEC’s directives if compensation proposal is expectable.
The SEC in a circular also requested the bourses to enlist MI Cement on condition of paying compensations.
As per the decision, the company will compensate primary investors if the shares prices go below the offer price within six months after the transaction of the shares of the company starts on the bourses
As per the decision, the company will compensate primary investors if the shares prices go below the offer price within six months after the transaction of the shares of the company starts on the bourses
Source: Daily-sun (2 June, 2011).
