The Financial Express

Rights subscription of Pragati Life begins Sept 24

The company to raise Tk 230.27m

| Updated: September 19, 2020 10:22:06

Lankabangla and Fianancial Express Lankabangla and Fianancial Express
Rights subscription of Pragati Life begins Sept 24

Rights shares subscription of Pragati Life Insurance is set to begin September 24, aiming to raise Tk 230.27 million.

The subscription period for the rights will be continued until October 20, 2020, officials said.

The rights issue is an offer of new shares by a company to its existing shareholders in proportion to the shares they already own and usually at a discount to market price.

The stock market regulator - Bangladesh Securities and Exchange Commission (BSEC)--approved the Pragati Life's application to raise Tk 230.27 million through rights issue on August 13.

The purposes of issuance of right shares are to cope with the business growth and strengthen the capital base of the company as well as fulfill the regulatory requirement.

The life insurer, which was listed on the Dhaka bourse in 2006, will issue more than 15.35 million rights shares of Tk 15 each, including Tk 5.0 as a premium to raise the said amount. The company will issue one rights share against existing one share (1R:1).

Pragati Life Insurance has decided to raise paid-up capital by issuing rights shares to fulfill the regulatory requirement in line with the Insurance Act-2010.

The company will invest the rights offer amounts in government treasury bonds, and in fixed deposits at banks and financial institutions.

The company has reported net asset value per share of Tk 37.29 as on December 31, 2018, according to the rights issue documents.

LankaBangla Investment Ltd is the issue manager of the company's rights issue.

Each share of the life insurer closed at Tk 90.20 on Tuesday, losing 1.95 per cent over the previous session on the DSE.

Its share price traded between Tk 73.30 and Tk 159.90 in the last one year.

Recently, the board of directors of the company declared 20 per cent cash dividend for the year ended on December 31, 2019.

In 2018, the company disbursed 15 per cent cash and 15 per cent stock dividend.

Pragati's paid-up capital is Tk 153.52 million and authorised capital is Tk 250 million while total number of securities is 15.35 million.

The sponsor-directors own 41.32 per cent stake in the company, while the institutional investors own 24.94 per cent and the general public 33.74 per cent as on August 31, 2020, the DSE data shows.

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