The Bangladesh Securities and Exchange Commission (BSEC) has allowed eligible private and large companies to list directly on the stock market without going through an initial public offering (IPO).
In a notification issued on Sunday, the market regulator published the official rules for direct listing, expanding an opportunity previously restricted to state-owned enterprises. Under these rules the existing shareholders can offload their shares directly on a stock exchange without issuing new securities to the public.
To qualify the eligible businesses must fall into specific categories, including companies with at least 10% government ownership, as well as firms wholly or majority-owned (at least 51% paid-up capital) by foreign investors.
Additionally the scheduled banks, financial institutions and insurance companies with a net worth of at least Tk.5 billion based on their latest audited financial statements are eligible. Non-financial companies with an annual turnover of at least Tk.10 billion also qualify along with registered stock exchanges, central depositories and clearing and settlement companies.
The BSEC noted that it reserves the authority to specify other eligible entities on a case-by-case basis. Industry experts expect the move to attract large conglomerates and foreign-owned firms, deepening Bangladesh’s capital markets and offering investors access to high-performing companies.
