BRB Group to buy 3.96% of Eastern Cables shares

BRB Group is going to buy 3.96% of state-run cable manufacturer Eastern Cables Ltd shares at the existing market price through the Dhaka Stock Exchange (DSE) within the next 30 days.

BRB Cables and MRS Industries Limited, both sister concerns of BRB Group and also corporate directors of Eastern Cables, will buy 5.21 lakh and 5.25 lakh shares respectively.

This is a bid to establish monopoly in the huge domestic cable market, said a BRB Cables official requesting not to be named.

He said BRB now holds around 40% of the domestic cable market share.

When the news was revealed on the DSE website on Monday, Eastern Cables share trading came to a halt after reaching the 10% circuit breaker limit. Its shares closed at Tk155.1 each at the DSE.

Earlier in 2018, BRB Group bought 17.76% of Eastern Cables shares to secure directorship in the company.

Currently, BRB Cables Chairman Md Mozibar Rahman holds 13.59 lakh or 5.66% of shares in Eastern Cables, while Director Shamsur Rahman owns 4.88 lakh or 2.04%, MRS Industries 12.24 lakh or 5.10%, and BRB Cables 11.96 lakh or 4.96%. They all are also directors of Eastern Cables.

Meanwhile, Eastern Cables failed to pay any dividend to its shareholders as it had incurred losses during fiscal year 2019-20. The loss per share was Tk6.46.

The company also incurred Tk3.23 crore losses in the first quarter of the current fiscal year.

Eastern Cables was listed on the DSE in 1986. Its paid-up capital is Tk26.40 crore.

The government holds 51% of shares of the company, while institutional and general investors own 17.73% and 13.50% respectively.