The Bangladesh Securities and Exchange Commission (BSEC) has sought an explanation from Beximco Ltd for not disclosing as price-sensitive information (PSI) an initiative to auction the company’s mortgaged properties to recover Tk 191 crore owed to Rupali Bank.

Rupali Bank has taken steps to auction around 26 acres of land and other properties owned by Beximco in Gazipur and Narayanganj to recover the outstanding loan. The BSEC has asked why the development was not disclosed to investors.

The commission recently sent a letter to Beximco’s managing director seeking clarification on the matter.

According to the letter issued by the BSEC’s Supervision and Regulation of Issuer Companies Department under its Issuer Company Affairs Division, the commission learned from media reports that Rupali Bank had initiated the process of auctioning Beximco’s mortgaged properties to recover defaulted loans.

BSEC Executive Director and spokesperson Md Abul Kalam said the matter had come to the commission’s attention and that Beximco had been asked to explain its position.

“The commission has taken note of the matter and sought an explanation from Beximco Ltd. After receiving the company’s response, the commission will review it and take further decisions,” he said.

The BSEC considers the proposed auction significant because the disposal of major company assets to recover Tk 191 crore could be linked to Beximco’s financial condition, loans and liabilities. The loss of substantial assets through an auction could potentially affect the company’s financial position and therefore may constitute important information for investors.

The commission has considered the relevant provisions on price-sensitive information under the Bangladesh Securities and Exchange Commission (Prohibition of Insider Trading) Rules, 2022, as well as regulations governing the disclosure of PSI.

The BSEC’s review found that Beximco had not disclosed any PSI regarding the proposed auction to the commission or the relevant stock exchanges. The company has therefore been asked to explain why the matter was not disclosed as price-sensitive information.

Beximco has been instructed to submit a written explanation within seven working days of receiving the letter. However, the commission had not received the company’s response as of the time of filing the report.

The BSEC has also sought information from the Chittagong Stock Exchange (CSE) regarding the matter. CSE authorities said they had not received any response from Beximco either.

Market stakeholders said an initiative to auction significant assets of a listed company to recover a large amount of outstanding debt could be important information for investors. If substantial company assets face the risk of being auctioned, the development could influence investment decisions, making timely disclosure particularly important.

A copy of the BSEC letter has also been sent to the Dhaka Stock Exchange (DSE) managing director and relevant commission officials.

The BSEC will decide on further action after receiving and reviewing Beximco’s explanation.