B Mirror Report : Popular Life Insurance has faced difficulties after investing Tk 159.5 million in placement shares of seven companies that intended to enter the stock market through initial public offerings (IPOs).
However, the IPO applications of those companies were later canceled, raising concerns over the recovery of the invested funds. As a result, Popular Life Insurance has filed lawsuits to reclaim the investment.
According to financial records, Popular Life had invested in placement shares several years ago, but the companies were unable to proceed with their IPOs. The recovery status or financial condition of these companies remains unclear. Out of the total Tk 159.5 million investment, Popular Life filed a case on 27 August 2023 against five companies to recover Tk 135 million.
The investments include:
Amulet Pharma: Tk 60 million
B Brothers Garments: Tk 36 million
Beka Garments: Tk 24.5 million
X-Tile Mills: Tk 12 million
Desh Denim: Tk 2.5 million
Credence Asset Management: Tk 12.5 million
Albi Textile Mills: Tk 12 million
Among these, lawsuits have been filed against the first five companies to recover Tk 135 million, while Credence Asset and Albi Textile were excluded.
Meanwhile, under Section 232 of the 2006 Labor Act, it is mandatory to form a Workers’ Profit Participation Fund (WPPF) and distribute it to employees within nine months. However, Popular Life Insurance failed to comply in 2024, depriving employees of their rightful benefits.
Audits also revealed that Popular Life Insurance provides commission payments to agents via checks and cash, but cash payments were made outside legal procedures.
Furthermore, the company does not comply with Bangladesh Securities and Exchange Commission (BSEC) regulations, which require entrepreneurs/directors to collectively hold at least 30% shares in each listed company. Currently, Popular Life’s entrepreneurs/directors hold only 23.7%.
It is notable that Popular Life Insurance, listed in the stock market in 2005, has a paid-up capital of Tk 604.3 million, with 76.3% ownership held by various categories of investors. As of Sunday (28 December), the company’s share price stood at Tk 41.60.
