Excelsior Shoes gets BSEC ultimatum to comply with the 30% shareholding rule
Excelsior Shoes will be transferred from the over-the-counter (OTC) market to a new board, called the alternative trading board (ATB), once it opens on the DSE
The Bangladesh Securities and Exchange Commission (BSEC) has given an ultimatum to Excelsior Shoes Ltd - a 100% export-oriented shoemaker - to hold at least 30% shares of paid-up capital within 15 July 2022.
If the company misses the deadline, BSEC will reconstitute its board. The commission issued a letter in this regard last week.
Currently, the sponsors and directors of the company hold only 6.3% shares of its paid-up capital, whereas institutional investors have 23% and general investors 70.43%.
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Earlier, BSEC directed the Dhaka Stock Exchange (DSE) to inspect the premises of the company to assess its operational and financial status.
Excelsior Shoes will be transferred from the over-the-counter (OTC) market to a new board, called the alternative trading board (ATB), once it opens on the DSE.
Eligible non-listed securities can be traded in the ATB, and all types of investors will be able to trade.
According to sources, the BSEC is working to transfer some of the OTC companies to the ATB, and some to the SME board.
But before transferring Excelsior Shoes to the ATB, the commission wants to know the company's situation.
Recently, the BSEC has discussed the business of Excelsior Shoes with the company and will take the next step after getting the inspection reports.
Back in 1996, Excelsior Shoes raised Tk15 crore from the stock market for meeting capital expenditure and working capital requirements, and for repaying bank loans.
From its listing year till fiscal 2003-2004, the company made good business.
But in FY04, despite earning a decent revenue of Tk37 crore, the company incurred a loss of Tk1.16 crore.
It again returned to making profits in the 2007-2008 fiscal year, which continued till fiscal 2010-11.
During the year, the company's revenue stood at Tk62 crore and net profit at Tk3.38 crore.
But after FY11, the company failed to continue its business properly.
Its paid-up capital was Tk30 crore and the authorised capital was Tk100 crore.
