Dhaka, Bangladesh (BBN)-The Securities regulator on Wednesday approved the initial public offering (IPO) proposal of Zaheen Spinning Ltd (ZSL) to raise a fund worth BDT 120 million from public.
The approval came at the Bangladesh Securities and Exchange Commission (BSEC) meeting held at the BSEC office.
Using the fixed price method, the company will float 12 million ordinary shares at an offer price of BDT 10.
According to the financial statement for the year ended on June 30, 2014, the company’s earning per share (EPS) and net asset value (NAV) are BDT 1.01 and BDT 12.59 respectively.
As per BSEC approval, First Security Islami Bank will issue one rights share against two existing shares at an offer price of ten taka each.
The securities regulator has also imposed further conditions for capital raising and rights issue.
The listed companies from now on will not be able to utilise more than one third of their funds raised through IPO for the purpose of loan repayment, officials said.
“No issuer of a listed security shall take decision to issue rights shares within two years from the date of publication of prospectus for IPO and before full utilisation of fund raised through IPO, previous rights issue or re-peat public offer (RPO),” the BSEC said.
And the companies which will be re-listed with any exchange from over the counter (OTC) market will not be able to issue rights shares before completing three financial years.  
As per further conditions imposed for capital raising, 3-year lock-in will be imposed on the shares transferred by existing sponsors or directors to any person, other than existing shareholders, within 12 months of submitting application for capital raising or public offering.
And all money raised against allotment of shares or in the form of share money deposit will have to be deposited in a separate bank account, said the BSEC.
According to another condition, no company and/or its sponsors, directors, employees or appointed agents will be shall approach to take share money deposit from any person, other than existing shareholders, for subscribing shares of the company, before obtaining consent for rasing capital from the securities regulator complying applicable securities rules.
BBN/BB/ANS-29Oct14-9:00pm (BST)