Asia Energy Announces Plans to List on Stock Market in Bangladesh

Asia Energy, which is developing a US$2 billion coal mine at Phulbari in northwest Bangladesh, on March 18 announced that it is planning to list on the stock market in Bangladesh.

The group's Bangladesh subsidiary said that following several months of detailed negotiations it had signed a Letter of Intent (LoI) with Equity Partners Limited, a majority foreign owned local merchant bank, for an initial public offering (IPO) later this year.

"This decision is part of Asia Energy's commitment to giving investors in Bangladesh an opportunity to share in this major development project," said Gary Lye, CEO of Asia Energy Corporation (Bangladesh) Pty Ltd.

"It is also a measure of our long-term commitment to Bangladesh."

The Letter of Intent was signed by Lye and Equity Partners Limited Director Saiful Islam at Asia Energy Corporation (Bangladesh) Pty Ltd office in Dhaka Saturday.

Asia Energy, which operates in Bangladesh under an existing contract with the government, is in the final stages of project approval and financing for its planned 15 million tons per annum open pit coal mine at Phulbari in Dinajpur district.

It has established a resource of 572 million tons of high quality thermal and semi-soft coking coal in the Phulbari coal basin, and is waiting for government's approval of its Scheme of Development for the mine in line with its contract.

Plans for the mine were given Environmental Clearance by the government in September 2005.

The local share placement will take place as soon as practical following the approval, the company said.

Pre-mining activity is scheduled to start later this year with first coal expected in late 2008 and production then increasing rapidly to 15 million tons per annum by 2013. The company has proposed to build a 500 MW power plant at the mine site.

Asia Energy expects that up to 4.5 million tons per annum will remain in Bangladesh for industrial and power uses. Expressions of Interest for the marketing and distribution of this coal into the local economy will be sought shortly after government approval.

There will be similar arrangements for marketing co-products from the mine, including kaolin, sand and aggregate.

Local construction contracts will also be sought for the significant infrastructure required for the project and related community housing and services.

Shares in Asia Energy's parent company, Asia Energy PLC, are quoted on the London Stock Exchange's Alternative Investment Market (AIM). Leading London based advisors for Asia Energy are JP Morgan Cazenove and Barclays Capital.

Equity Partners Limited (EPL) is a full service merchant Bank licensed by the Bangladesh Securities Exchange Commission, and it has been responsible for the listings of Lafarge Surma Cement Limited, currently the largest company by market capitalization in Bangladesh, and several other successful listings and advisory mandates, including the cross-border acquisitions in Bangladesh by Mumbai-stock exchange listed Marico Industries Limited.

EPL was also recently appointed one of the major local partners of German Development Company (DEG) to identify new business opportunities in Bangladesh.

EP Report

Companies with Paid up Capital over Tk 50 Cr to Go Public

Sohel Parvez
BDNEWS

The Securities and Exchange Commission (SEC) has finalized a draft regulation for the companies asking those with paid up capital of above Tk 50 crore to go public, official sources said.

The draft is now awaiting gazette notification to take effect, sources at the SEC said, adding it could take around a month to become operational.

"We will start collecting information about companies with paid up capital of over Tk 50 crore from the Registrar of Joint Stock Companies & Firms after the publication of the gazette," Mansur Alam, Executive Director of the SEC, told BDNEWS.

The SEC finalized the new regulation on February 8, 2006, which makes it mandatory for companies of the above category to raise at least 30 percent of their capital from the public.

The SEC new rule would be applicable to the companies, both local and foreign, operating in the country for three years and above.

The rule also makes it mandatory for companies with paid up capital of Tk 40 crore and above to convert them into public limited company within twelve months from the date of publication of the notification.

SEC sources said the Commission has already identified some companies falling within the two categories.

Of the companies identified by the SEC, 25 will need to be converted into public limited company, while five others have to go public through floating initial public offering (IPO).

The five companies include the American Super Specialty Hospital Ltd., the Imperial Hospital Ltd., the Karnaphuly Fertilizer Company Ltd. (KAFCO), the TM International (BD) Ltd., which operates the AKTEL mobile phone, and the Unique Hotel & Resorts Ltd.

SEC sources, however, said the number of companies falling within the categories would be higher than what it identified.


PGCB

PGCB was incorporated in November 1996 with an initial authorized capital of Tk 10 billion divided into 10 million ordinary shares of Tk 1,000 each and entrusted with the responsibility to own, operate and expand the national power grid network for transmission of electricity. It owns 100 percent of the system of the country.

In view of the recent growth in electricity demand and targeted economic growth rate of 8 percent per annum, PGCB aims to achieve the goal of transmitting about 7,000 megawatt of electricity through its transmission lines and grid sub-stations to different areas of the country by June 2006.

PGCB is working closely with various funding organizations and was able to streamline necessary funding for several projects and negotiations are continuing to obtain funding for the other projects. Since soft financing for Bangladesh power system has been decreasing gradually, PGCB has adopted the policy of undertaking expansion program with its own resources.