Beximco gets more time to raise fund through Sukuk
The stock market regulator has again extended the time for Beximco till September 30 to raise Tk 3,000 crore through Sukuk bonds as it failed to attract investors.
The subscription of the Sukuk through initial public offering (IPO) started on August 16 that was supposed to end on August 23, but the time was extended till September 6. Bangladesh Securities and Exchange Commission allowed Beximco to issue the Shariah-compliant Sukuk on July 8.
Half of the Tk 3,000-crore fund will be raised through private placement and the Sukuk worth Tk 750 crore will be raised from the existing shareholders of the Beximco.
The remaining Tk 750 crore will be raised through an IPO. The regulator informed the company in a letter that the public offer would be cancelled if it is not subscribed by September 30.
The BSEC allowed the company to interchange the Sukuk subscription amount between the IPO and the private placement if any of them remains undersubscribed.
Beximco's Sukuk is convertible asset-backed green Sukuk, which will have a tenure of five years.
With the proceeds of the Sukuk, the company will finance solar projects and expand its textile factory.
Each unit of the Sukuk would be Tk 100 where minimum subscription amount should be Tk 5,000.
Minimum periodic distribution rate is 9 per cent.
The Sukuk proceeds will be used to implement projects of Teesta Solar and Korotoa Solar, two subsidiaries of Beximco Power Company.
It will also be used to purchase new machinery required for the expansion of Beximco's textile division.
Teesta Solar is a joint venture of Beximco Power and China's TBEA Xinjiang Sunoasis Company.
Under an agreement, the Bangladesh Power Development Board will purchase electricity from Teesta Solar for 20 years at $0.15 per kilowatt hour.
Korotoa Solar is a joint venture between Beximco Power and the Jiangsu Zhongtian Technology Company.
According to a 20-year agreement, the BPDB will buy electricity from Korotoa Solar's plant at $0.14 per kilowatt hour.
City Investments Capital Resources is the issue manager of the Sukuk.
In December last year, the government issued Tk 8,000 crore Sukuk for a safe water supply project.
There was a huge response to this initiative from Shariah-based banks, non-banking financial institutions and other eligible parties.
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