Initial Public Offering in Capital Market of Bangladesh

Helping to manage the prospectus process, closing, sale of the securities, and after market activities.

The management team works with the issue manager, underwriters, auditors, and lawyers to schedule the offering process, prepare materials related to the offering (e.g., the prospectus, marketing materials), respond to regulators’ comments, and finalize documents related to the offering.

After the public offering, the management team is involved in investor relations activities and regulatory filings that are part of life as a public company. In short, significant demands will be made on management’s time before, during, and after the public offering. Management must be prepared for these responsibilities and be capable of executing them.

External members Issue Manager Issue Manager experienced in the process can help the company prepare for the offering by Coordinating the preparation of a corporate profile that incorporates all the necessary prospectus requirements Providing assistance in determining the information required for the audited historical and interim financial statements for inclusion in the prospectus Coordinating the presentation of any forecasts and related disclosures Developing a model to assist in identifying the valuation parameters for the company, funds to be raised, equity stake to be sold to the company, and number of shares to be issued Providing strategic direction and assisting in the selection of the underwriters, including attending all the meetings, discussions, and negotiations that management considers appropriate throughout the offering process.

Appendix A provides list of Merchant bankers approved by Securities & Exchange Commission as per SEC (Portfolio Manager & Merchant Banker) Regulation 1996.

Underwriters The financial institution that guarantees to buy a proportion of any unsold securities when a new issue is offered to public, provided that the minimum subscription stated in the prospectus has been cold to the public. As per SEC’s guideline, 50% of the public issue amount has to be underwritten by the underwriters on a firm commitment basis. This provides a safety net for the issuer in case the issue is undersubscribed.

If and to the extent that the shares offered to the public by a Prospectus authorized hereunder shall not have been subscribed and paid for in cash in full by the closing date, the Company shall within 10 (Ten) days of the closure of subscription call upon the underwriter in writing with a copy of said writing to the Securities and Exchange Commission, to subscribe for the shares not subscribed by the closing date and to pay for in cash in full for such unsubscribed shares in cash in full within 15 (Fifteen) days of the date of said notice and the said amount shall have to be credited into shares subscription account within the said period.

Bankers to the Issue They perform the job of collecting the investors’ money on behalf of the issuer during the subscription period of IPO. Various branches of banks are designated to collect money.

Auditors The auditing firm can play a significant and varied role in the complex process of helping you go public. Consequently, the auditing firm should be experienced and well qualified to provide both the audit and specialized services required for the IPO. Most companies select a firm that is experienced in securities offerings and in dealing with securities commissions, and that is well known in the investment community.

The right firm will also provide continuing counsel and assistance in dealing with the many financial reporting and other obligations of a public company. To audit public companies, the auditing firm has to be registered with Institute of Chartered Accountants Bangladesh. Auditors must be independent.

For public companies, the assessment of independence requires the consideration of specific factors.