BSEC approves Tk 607 crore preference shares for DESCO

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BSEC approves Tk 607 crore preference shares for DESCO

B Mirror Desk:

The Bangladesh Securities and Exchange Commission (BSEC) has approved the issuance of preference shares worth Tk 607.69 crore for Dhaka Electric Supply Company Limited (DESCO), a company listed in the banking sector of the capital market. This decision was made during the 911th commission meeting chaired by BSEC Chairman Professor Shibli Rubaiyat-ul-Islam on Sunday.

According to BSEC sources, these preference shares will be e-redeemable and non-cumulative, offering a 15 percent net profit after tax. The entire amount will be issued on behalf of the Government of Bangladesh, represented by the Secretary of the Electricity Department of the Ministry of Electricity, Energy, and Mineral Resources.

The dividend rate payable to the government will be 15% of the estimated share of the net profit after tax allocated to the preference shareholders. This is based on the proportion of the total capital, calculated using the formula: Government Preference Share Dividend = {(Preference Share Capital) / (Ordinary Share Capital + Preference Share Capital)} * Net profit after tax * 15%.

It is notable that from 1997 to 2021, the government has provided DESCO with Tk 607.69 crore for various development projects. Until now, this amount was recorded as public equity in the company’s financial statements.

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