The initial public offering (IPO) subscription of Best Holdings Limited, the operator of the high-end hotel Le Meridien in Dhaka’s Nikunja 2 area, has been changed.
Initially set for 8 January 2024, the subscription window will now begin on 14 January and continue until 18 January, as per the new schedule published on the stock exchange website on Tuesday.
To participate in the company’s IPO, Bangladeshi resident general investors must have at least Tk50,000 invested in listed securities by 3 January 2024. Non-resident Bangladeshis (NRBs) require Tk1 lakh.
Earlier, the electronic bidding for the company’s shares took place between 20 November and 23 November, where the cut-off price of the shares was fixed at Tk35 each.
Qualified and institutional investors including mutual funds will buy 25% of the company’s shares at the cut-off price. Individual investors will be able to buy the remaining shares at a 30% discounted price of Tk24 each.
The cut-off price is the price at which institutional investors have primary shares allocated for them in an IPO under the book-building method.
Earlier, on 10 October, the Bangladesh Securities and Exchange Commission (BSEC) allowed Best Holdings to raise Tk350 crore through an IPO under the book-building method from the capital market.
The company will use 50% of the fund or Tk176 crore for building construction and other civil works, 33%, or Tk115.6 crore for repayment of existing liabilities, and around 13% for local machinery and equipment acquisition.
Best Holdings is in the process of raising fresh funds to build a resort in Bhaluka. The cost of the total project, which will offer world-class hospitality outside the capital, is Tk1,586.91 crore, as per the prospectus. For this project, the IPO and the company’s fund will contribute Tk755 crore and the rest will come from loans.
According to the audited financial report of June 2023, the earnings per share (EPS) of the company stood at Tk1.24 and the year-weighted average EPS was at Tk0.95.