Confidence Cement exits battery business with Tk11.34cr stake sale

The company’s board of directors has approved the sale and transfer of its entire holding of 1.03 crore ordinary shares in Confidence Batteries, each with a face value of Tk10, according to a disclosure published on the Dhaka Stock Exchange (DSE).

Confidence Cement has decided to sell its entire shareholding in subsidiary Confidence Batteries Limited to Confidence Infrastructure for Tk11.34 crore to meet its immediate financial obligations and pursue its strategic objectives.

The company’s board of directors has approved the sale and transfer of its entire holding of 1.03 crore ordinary shares in Confidence Batteries, each with a face value of Tk10, according to a disclosure published on the Dhaka Stock Exchange (DSE) today (1 November).

The proposed transaction is valued at Tk11.35 crore. The two companies have entered into a share purchase agreement outlining the terms and conditions of the transaction.

However, the deal is subject to approval by Confidence Cement’s shareholders at a general meeting. The share price of the company decreased by 2.10% to Tk56 on the Dhaka Stock Exchange today.

Sale aimed at meeting financial obligations

In its disclosure, Confidence Cement said the board approved the proposal after considering the company’s strategic objectives and the need to meet its immediate financial obligations.

Once the transaction is completed, Confidence Cement will no longer hold any direct shares in Confidence Batteries, as its entire investment in the subsidiary will be transferred to Confidence Infrastructure.

The company, however, did not disclose the specific financial obligations it intends to meet with the proceeds from the sale. It also did not provide details about the potential impact of the ownership transfer on Confidence Batteries’ business operations or financial position.

Profit declines, operating cash flow turns negative

Meanwhile, Confidence Cement’s consolidated earnings per share declined to Tk10.20 in FY2025-26, from Tk11.23 in the previous fiscal year.

However, its net asset value per share increased to Tk96.89 from Tk88.68 during the same period.

The company’s net operating cash flow per share also deteriorated, turning negative at Tk4.79 in FY2025-26, compared with Tk0.07 in the previous year.

Despite the decline in earnings, the board has recommended a 10% cash dividend for FY2025-26. The company’s annual general meeting is scheduled to be held on 28 December, while the record date for the dividend has been set for 22 November.

Shareholders’ approval pending

Although the board has approved the proposed sale, the transaction is yet to receive final approval. Confidence Cement must obtain shareholders’ consent at a general meeting before completing the transfer in accordance with the share purchase agreement.

Investors will be watching how the proceeds from the sale are used to address the company’s immediate financial obligations and whether the transaction leads to any changes in its future investment and business strategy.

Source: The Business Standard