Bangladesh Submarine Cable Company has submitted its initial public offering (IPO) prospectus to the stockmarket regulator, revising its previous listing plan, officials said.
Earlier the telecom service provider planned listing through a direct listing method, but now it opts for a fixed price system. Under the revised plan, the company will float 3.10 crore ordinary shares of Tk 10 each at an offer price of Tk 35, using the fixed price method.
Previously, under the direct listing method, the offloading price of each share was supposed to be determined by institutional investors through bidding. However, the bidding process was going to use the book building method, which has been suspended now.
With instructions from the government, Securities and Exchange Commission suspended the book building method in January, following a debacle in the share market.
The listing process of the company was stalled after the book building system was suspended, said an official of Bangladesh Submarine Cable.
“After that, we were advised by our issue manager to go for an IPO using the fixed price method,” the official added.
The change in plans will also help the company financially, as it needs working capital to set up another substitute cable line to acquire bandwidth and ensure uninterrupted voice and data supplies, he said.
“If the shares were offloaded through the direct listing method, the money would go to the shareholders and the company could not use it,” the official said.
Now the funds to be raised can be used for the second cable line project, he added.
Md Monwar Hossain, managing director of Bangladesh Submarine Cable, confirmed that they submitted the IPO proposal to the SEC. They were asked to provide some necessary information to the commission.
“We will submit the additional information to the commission on Sunday,” he said.
Nasir Uddin Ahmed, chief executive officer of ICB Capital Management, the issue manager, said the existing paid-up capital of Bangladesh Submarine Cable is Tk 87.50 crore.
The net asset value per share with asset revaluation is Tk 17.56 and without asset revaluation is Tk 15.69. The existing earnings per share of the company is Tk 3.37, Ahmed added.
Formed in July 2008, Bangladesh Submarine Cable presently handles Bangladesh’s lone submarine cable — SEA-ME-WE-4 — and represents the country in the SMW-4 international cable consortium.
The existing bandwidth of the company is 44.6 Gbps. The company is upgrading its capacity to 160 Gbps that will be completed by February next year. The company is spending Tk 50 crore for its capacity upgradation.
-With The Daily Star input