The securities regulator has approved public issue rules, bringing changes in some existing provisions for both the book building and fixed price method.
The approval was given at a meeting held at the office of the Bangladesh Securities and Exchange Commission (BSEC) on Thursday.
At the meeting, the regulator also approved the draft prospectus of IDLC Balanced Fund and Tk 4.0 billion subordinate bond to be issued by Standard Bank.
As per the existing rules, a company having a minimum paid-up capital of Tk 150 million at par can offer at least 10 per cent of its paid-up capital (including intended offer) or Tk 150 million at par value, whichever is higher.
Under the revised fixed price method, a company willing to go public must have a minimum paid-up capital of Tk 150 million and the size of IPO (initial public offering) will be Tk 300 million.
And as per the revised book building method, a company must have a minimum paid-up capital of Tk 300 million and the size of IPO (initial public offering) will be Tk 500 million, including premium.
The securities regulator has set the provision of applying for maximum 2.0 per cent securities of respective quota of eligible investors (EIs).
As per the existing provision, an EI can quote for up to 10 per cent of the total amount offered to the EIs.
And the securities will be allotted as per the ratio of securities applied by all EIs.
The securities regulator has reduced the quota for EIs following the suggestions put forward by stakeholders, including the Dhaka Stock Exchange (DSE).
In their suggestions, the stakeholders said only 10 EIs have a scope to fix the cut-off price, at which EIs get securities, as one quote for up to 10 per cent of the securities offered for them.
The securities regulator has imposed a three-year lock-in on the shares of sponsors, directors and other shareholders having shares above 10 per cent of the company's total paid-up capital. As per the existing provision, this lock-in period is applicable to the shareholders having 5.0 per cent shares compared to total paid-up capital.  
The securities regulator will seek public opinion soon before giving final approval to the revised public issue rules.
At Thursday's meeting, the securities regulator approved the draft prospectus of IDLC Balanced Fund which will be floated with an initial size of Tk 500 million.
The sponsors will contribute Tk 100 million and remaining Tk 400 million will be collected from unit holders. The offer price of the units of IDLC Balanced Fund, an open-end mutual fund, is Tk 10 per unit.
IDLC Asset Management Company will manage the fund and IDLC Finance is the sponsor of the fund.
The tenure of Tk 4.0 billion subordinate bond to be issued by Standard Bank will be seven years. The offer price of each unit of the bond will be Tk 10 million.
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Source: The Financial Express