Prospectus of bsrm steels limited Essay Example for Free

Prospectus of bsrm steels limited EssayDeclarations and due diligence awards Declaration about(predicate) the function of the Directors including the CEO of the Comp some(prenominal) in respect of the course catalogue Consent of the Directors to Serve Declaration about filing of course catalogue with the recording equipment of Joint Stock Companies Firms ascrib fitting Diligence Certificate of Manger to the contr deed of conveyance Due Diligence Certificate of the Underwriter(s) Risk factors management perceptions about the risks Capital structure Use of IPO emergence Description of business Back ground of the project Important visualize Nature of business Principal products and dishs The Rolling ProcessMarket for the BSRMS Products relational contribution to income Associate subsidiary/related holding comp any(prenominal) Distribution of products/services Sources and availability of raw materials and principal suppliers Competitive condition of business Sources of and requirement for power, gas and water or any another(prenominal) utilities Customer providing 10% or more revenues Contract with principal customers and suppliers clobber patents, trademarks, license or royalty agreements Number of employees (as per audited aims) Capacity and current utilization of facility Description of property pecuniary Condition and Plan of OperationInternal and external sources of fund (as per audited accounts) Material commitment for capital expenditure Causes for material changes Seasonal aspect of the Companys business Known trends, events or uncertainties Change in the assets of the Company employ to pay off any liabilities Loan taken from holding/ cite company or subsidiary company Loan given to holding/ comparisonent company or subsidiary company Future contractual liabilities Future capital expenditure VAT, income tax, customs duty or other tax obligation Operating lease agreement monetary lease and other financial commitment Personnel related schemeRevaluation of assets Breakdown of going expenses Auditors certificate regarding any allotment of sells to promoters or Sponsor shareholders for consideration other than in cash -5- Page No 7 7 10 11 11 11 11 12 12 13 15 15 15 15 15 15 16 16 17 17 17 17 17 18 18 18 18 19 19 19 19 20 20 20 20 20 20 21 21 21 21 21 21 21 21 21 21 22 22 Issuer Issue Managers Alliance pecuniary Services control BSRM Steels Limited southerly Asia Capital Limited Item proceeding with subsidiary/holding company or sort companies Material teaching which is likely to have an impact Directors and officers Information regarding directorshipDirectors involvement in other organization Family relationship among directors and top five officers Short bio-data of the directors mention information Bureau (CIB) report Description of senior executive and departmental heads Involvement of Directors and officers in certain legal proceedings Certain Relationships and Related Transactions Transaction with related parties Directors facilities Executive compensation Remuneration pay to top five salaried officers Aggregate amount of remuneration paid to directors and officers (as audited accounts) Remuneration paid to Director who was non an officerFuture compensation to Director or officers Pay increase intention Options granted to Directors, officers and employees Transaction with the Directors and subscribers to the Memorandum Tangible assets per share Ownership of the Companys securities Composition of Shareholders Share hold by Directors Shareholding structure 5% or more as on 30 April 2008 Securities possess by the officers Determination of offering price Market for the securities being offered Declaration about listing of shares with Stock step in Trading and settlement Description of Securities neat or being offered Dividend, voting, pre-emption rightsConversion and liquidation rights Dividend policy Other rights of shareholders Debt securities Lock-in on sponsors share Re fund of subscription bullion Subscription by and refund to non-resident Bangladeshi (NRB) accessibility of securities Offer Application for subscription Allotment Under written material of shares Principal terms and conditions of at a lower placewriting agreement Underwriters right to represent in the Board of Directors of the Company Auditors report to the shareholders Audited Financial Statements Auditors report under naval division 135(1), Para 24(1) of part II of schedule III to Companies Act, 1994 Ratio AnalysisAdditional disclosures as infallible by Securities and Exchange relegation Credit rating report of BSRMS Application forms -6- Page No 23 23 23 23 24 25 26 26 27 27 27 27 28 28 28 28 28 28 28 29 29 29 29 29 29 30 30 30 30 31 31 31 31 31 31 32 32 32 36 36 36 36 37 38 38 38 38 39 40 54 55 57 59 76 Issuer Issue Managers Alliance Financial Services Limited BSRM Steels Limited South Asia Capital Limited Disclosure in respect of proceeds of security measures in Dema t Form As per provision of the sedimentation Act, 1999 and regulations do thither under, shares leave alone only be issued in dematerialized condition. All transfer/transmission/ split will take place in the commutation Depository Bangladesh Ltd. (CDBL) system and any further issuance of shares (right/bonus) will be issued in dematerialized form only. Conditions under Section 2CC of the Securities and Exchange Ordinance, 1969 Part A 1. The company shall go for Initial Public Offer (IPO) for 20,00,000 ordinary shares of Taka 100 (taka one hundred) each at par worth Taka 20,00,00,000 (Taka twenty crore) only following the Securities and Exchange guidance (Public Issue) Rules, 2006, the Depository Act, 1999 and regulations made there under.2. The abridged version of the prospectus, as approved by the missionary station, shall be published by the issuer in four national daily newspapers (in two Bangla and two English), inside 03 ( tether) working age of issuance of this letter . The issuer shall post the full prospectus vetted by the Securities and Exchange foreign mission in the issuers website and shall also put on the websites of the Commission, stock exchanges, and the issue managers indoors 03 (three) working geezerhood from the witness of issuance of this letter which shall ride out posted till the closure of the subscription list.The issuer shall submit to unsweet, the stock exchanges and the issue managers a diskette containing the text of the vetted prospectus in MS -Word format. 3. adequate copies of prospectus shall be made available by the issuer so that any person requesting a reproduction whitethorn receive one. A notice shall be placed on the front of the application form distributed in connection with the offering, informing that interested persons are entitled to a prospectus, if they so desire, and that copies of prospectus whitethorn be obtained from the issuer and the issue managers.The subscription application shall indicate i n bold type that no sale of securities shall be made, nor shall any money be taken from any person, in connection with such sale until twenty five geezerhood after the prospectus has been published. 4. The company shall submit 40 (forty) copies of the printed prospectus to the Securities and Exchange Commission for official record in spite of appearance 5 (Five) working days from the date of worldly concernation of the abridged version of the prospectus in the newspaper. 5.The issuer company and the issue managers shall fancy transmission of the prospectus, abridged version of the prospectus and relevant application forms for NRBs through e-mail, simultaneously with earthation of the abridged version of the prospectus, to the Bangladesh Embassies and Missions abroad and shall also get word move of the printed copies of abridged version of the prospectus and application forms to the said Embassies and Missions within five working days of the publication date by express mail s ervice (EMS) of the postal department.A compliance report shall be submitted in this respect to the SEC jointly by the issuer and the issue managers within two working days from the date of said dispatch of the prospectus the forms. 6. The paper clipping of the published abridged version of the prospectus, as mentioned at condition 2 above, shall be submitted to the Commission within 24 hours of the publication thereof. 7.The company shall maintain separate cashbox account(s) for collecting proceeds of the Initial Public Offering and shall also open FC account(s) to put the application money of the Non- occupant Bangladeshis (NRBs) for IPO purpose, and shall incorporate full particulars of said FC account(s) in the prospectus. The company shall open the abovementioned accounts for IPO purpose and close these accounts after refund of over-subscription.Non- Resident Bangladeshi (NRB) means Bangladeshi citizens staying abroad including all those who have dual citizenship (provided t hey have a valid Bangladeshi passport) or those, whose foreign passport turf out a stamp from the interested Bangladesh Embassy to the effect that no visa is required to travel to Bangladesh. 8. The issuer company shall apply to all the stock exchanges in Bangladesh for listing within 07(seven) working days from the date of issuance of this letter and shall simultaneously submit the vetted prospectus with all exhibits, as submitted to SEC, to the stock exchanges.9. The following declaration shall be made by the company in the prospectus, namely Declaration about Listing of Shares with the Stock Exchange(s) None of the stock exchange(s), if for any reason, grants listing within 75 days from the closure of subscription, any allotment in terms of this prospectus shall be void and the company shall refund the subscription money within fifteen days from the date of refusal for listing by the stock exchanges, or from the date of expiry of the said 75 (seventy five) days, as the case may be.In case of non -refund of the subscription money within the aforesaid fifteen days, the company directors, in addition to the issuer company, shall be collectively and severally liable for refund of the subscription money, with interest at the rate of 2% (two percent) per month above the bank rate, to the subscribers concerned. -7- Issuer Issue Managers Alliance Financial Services Limited BSRM Steels Limited South Asia Capital LimitedThe issue managers, in addition to the issuer company, shall ensure due compliance of the above mentioned conditions and shall submit compliance report thereon to the Commission within seven days of expiry of the aforesaid fifteen days time period allowed for refund of the subscription money. 10. The subscription list shall be opened and the sale of securities commenced after 25 (twenty five) days of the publication of the abridged version of the prospectus and shall remain open for 5 (Five) consecutive banking days. 11.A non-resident Bangladesh i shall apply either directly by en shutting a foreign demand draft force on a bank payable at Dhaka, or through a nominee by paying out of foreign currency pose account maintained in Bangladesh or in Taka, supported by foreign currency encashment certificate issued by the concerned bank, for the value of securities applied for through crossed bank cheque marking Account Payee only. The NRB applicants shall send applications to the issuer company within the blockage date of the subscription so as to reach the aforementioned(prenominal) to the company by the closing date plus nine days.Applications certain by the company after the above time period will not be considered for allotment purpose. 12. The company shall apply the spot buying rate (TT clean) in US Dollar, UK Pound Sterling and Euro of Sonali Bank, which shall be mentioned in the Prospectus, as prevailed on the date of opening of the subscription for the purpose of application of the NRBs and other non-Bangladeshi pers ons, where applicable. 13. The company and the issue managers shall ensure prompt collection/clearance of the foreign remittances of NRBs and other non-Bangladeshis, if applicable, for allotment of shares.14. Upon closing of the period of subscription for securities the issuer and the issue managers shall jointly provide the Commission and the stock exchanges with the preliminary status of the subscription within 05 (five) working days, in respect of the following matters, namely (a) meat number of securities for which subscription has been received (b) Amount received from the subscription and (c) Amount of commission paid to the banker to the issue. 15.The issuer and the issue managers shall jointly provide the Commission and the stock exchanges the list of valid and hinder applicants in 2 (two) CDs and final status of subscription to the Commission within 3 (three) weeks after the closure of the subscription along with bank affirmation (original), branch-wise subscription sta tement. The list of valid and disenable applicants shall be finalized after examination with the CDBL in respect of BO accounts and particulars thereof. 16.The IPO shall stand cancelled and the application money shall be refunded immediately (but not later than 5 (Five) weeks from the date of the subscription closure) if any of the following events occur (a) Upon closing of the subscription list it is found that the list number of valid applications (in case of under subscription including the number of the underwriter) is less than the negligible requirement as specified in the listing regulations of the stock exchange(s) concerned or (b) At least 50% of the IPO is not subscribed. 17.10% of total public offering shall be reserved for non-resident Bangladeshi (NRB) and 10% for mutual funds and collective investment schemes registered with the Commission, and the remaining 80% shall be open for subscription by the general public. In case of under subscription under any of the 10% categories mentioned above, the unsubscribed portion shall be added to the general public category and, if after such addition, there is over subscription in the general public category, the issuer and the issue managers shall jointly conduct an open lottery of all the applicants added together.18. All the applicants shall first be treated as applied for one minimum market lot of 50 shares worth Tk. 5000/-. If, on this basis, there is over subscription, then lottery shall be held amongst the applicants allocating one acknowledgment number for each application, ir individual of the application money. In case of over-subscription under any of the categories mentioned hereinabove, the issuer and the issue managers shall jointly conduct an open lottery of all the applications received under eachcategory separately in presence of representatives from the issuer, the stock exchanges and the applicants, if there be any. 19. An applicant cannot submit more than two applications, one in his /her own name and another jointly with another person. In case an applicant makes more than two applications, all applications will be treated as invalid and will not be considered for allotment purpose. In addition, whole or part of application money may be forfeited by the Commission. -8- Issuer Issue Managers Alliance Financial Services Limited BSRM Steels LimitedSouth Asia Capital Limited 20. The primary shares allotted to an applicant through IPO may be forfeited by SEC, if the BO account of the said applicant is found closed at the time of allotment of shares. All IPO applicants are required to keep their BO accounts operational till allotment of IPO shares. 21. Lottery (if applicable) shall be held within 4 (four) weeks from closure of the subscription date. 22. The company shall issue share allotment letter to all successful applicants within 5 (five) weeks from the date of the subscription closing date.Within the same time, Refund to the unsuccessful applicants shall be made in the currency in which the value of securities was paid for by the applicants without any interest through Account Payee Cheque/ refund warrants with bank account number, banks name and branching as indicated in the securities application forms payable at Dhaka/ Chittagong/ Khulna/ Rajshahi/ Barisal/ Sylhet/ Bogra, as the case may be subject to condition 19 above. Refund money of the unsuccessful applicants shall be credited directly to their respective bank accounts within 5 (five) weeks from the date of the subscription closing, who have mentioned in the IPO application forms, bank account numbers with the bankers to the issue and other banks as disclosed in the prospectus. A compliance report in this regard shall be submitted to the Commission within 6(six) weeks from the date of closure of subscription. 23. The company shall furnish the List of Allotees to the Commission and the stock exchange(s) simultaneously in which the shares will be listed, within 24 (twenty four) hours of allotment.24. In the event of under-subscription of the public offering, the unsubscribed portion of securities shall be taken up by the underwriter(s) (subject to para -16 above). The issuer must notify the underwriter to take up the underwritten shares within 10 (ten) days of the subscription closing date on full payment of the share money within 15(fifteen) days of the issuers notice. The underwriter shall not share any underwriting fee with the issue managers, other underwriters, issuer or the sponsor group. 25.All issued shares of the issuer at the time of according this consent shall be subject to a lock in period of three years from the date of issuance of prospectus or commercial operation, whichever comes later Provided that the persons, other than directors and those who hold 5% or more, who have subscribed to the shares of the company within immediately preceding two years of according consent, shall be subject to a lock -in period of one year from the date of i ssuance of prospectus or commercial operation, whichever comes later.26. Either a Jumbo Share (one for each of the existing Sponsors/ Directors/ Shareholders) in respect of the shares already issued shall be issued covering together respective total holding, which shall contain the expiry date of lock-in period or Sponsors/Directors/Promoters/Shareholders shareholding shall be converted into demat form but shall be locked-in as per the condition at para-25 above. 27.In case of Jumbo Share Certificate issued to the existing Sponsors/ Directors/Shareholders, the said share certificates shall be kept under custody of a security custodian bank registered with SEC during the lock-in period. The name and branch of the bank shall be furnished to the Commission jointly by the issuer and the issue managers, along with a confirmation thereof from the custodian bank, within one week of listing of the shares with the stock exchange(s). 28. In case of dematerialization of shares heldby the exis ting Sponsors/ Directors/Shareholders, the copy of dematerialization confirmation report generated by CDBL and attested by the managing director of the company along with lock-in confirmation shall be submitted to SEC within one week of listing of the shares with the stock exchange(s). 29. The company shall apply to the stock exchanges for listing within 7(seven) working days of issuance of this letter and shall simultaneously submit to the Commission attested copies of the application filed with the stock exchanges.30. The company shall not declare any benefit other than cash dividend based on the financial statement for the period ended December 31, 2007. Part-B 1. The issue managers (i. e. , Alliance Financial Services Limited and South Asia Capital Limited) shall ensure that the abridged version of the prospectus and the full prospectus is published correctly and in strict conformity without any fallacy/omission, as vetted by the Securities and Exchange Commission. 2.The issue managers shall carefully examine and compare the published abridged version of prospectus on the date of publication with the copy vetted by SEC. If any discrepancy/inconsistency is found, both the issuer and the issue managers shall jointly publish a corrigendum immediately in the same newspapers concerned, simultaneously endorsing copies thereof to SEC and the stock exchange(s) concerned, correcting the discrepancy/inconsistency as required under Due Diligence Certificates provided with SEC. -9- Issuer Issue Managers Alliance Financial Services Limited BSRM Steels Limited South Asia Capital Limited 3. Both the issuer company and the issue managers shall, immediately after publication of the prospectus and its abridged version, jointly inform the Commission in writing that the published prospectus and its abridged version are verbatim copies of the same as vetted by the Commission. 4. The fund collected through IPO shall not be utilized prior to listing with stock exchange and th at utilization of the said fund shall be effected through banking channel, i.e. through account payee cheque, pay recite or bank drafts etc. 5. The company shall furnish report to the Commission on utilization of IPO proceeds within 15 days of the closing of each quarter until such fund is fully utilized, as mentioned in the schedule contained in the prospectus, and in the event of any irregularity or inconsistency, the Commission may employ or engage any person, at issuers cost, to examine whether the issuer has utilized the proceeds for the purpose disclosed in the prospectus.6. All transactions, excluding little cash expenses, shall be effected through the companys bank account(s). 7. Proceeds of the IPO shall not be used for any purpose other than those specified in the prospectus. Any deviation in this respect must have prior approval of the shareholders in the General Meeting under breathing time to SEC and stock exchange(s). 8. The company shall remove the restrictive clau ses regarding issuance transfer of shares and grouping of shares from its Articles of Association.Part C 1. All the above conditions imposed under section 2CC of the Securities and Exchange Ordinance, 1969 shall be incorporated in the prospectus immediately after the page of the table of contents, with a reference in the table of contents, prior to its publication. 2. The Commission may impose further conditions/restrictions etc. from time to time as and when considered necessary, which shall also be binding upon the issuer company. Part D 1.As per provision of the Depository Act, 1999 and regulations made there under, shares will only be issued in dematerialized condition. All transfer/transmission/splitting will take place in the Central Depository Bangladesh Ltd. (CDBL) system and any further issuance of shares (including right/bonus) will be made in dematerialized form only. An applicant (including NRB) shall not be able to apply for allotment of shares without beneficial owner account (BO account).2. The issue managers shall also ensure due compliance of all above. GENERAL INFORMATION Alliance Financial Services Limited (AFSL) and South Asia Capital Limited (SACL) have prepared the prospectus from information supplied by BSRM Steels Limited (the Issuer Company) and also after several discussions with the prexy, Managing Director, Directors and concerned executives of the company.BSRM Steels Limited, Alliance Financial Services Limited and South Asia Capital Limited collectively and individually, having made all reasonable inquiries, confirm that to the best of their knowledge and belief, the information contained herein is true and correct in all material aspects and that there are no other material facts, the omission of which, would make any statement herein misleading.No person is authorized to give any information or to make any representation not contained in this Prospectus and if given or made, any such information and representation must not be relied upon as having been authorized by the company or Alliance Financial Services Limited and South Asia Capital Limited. The Issue as contemplated in this prospectus is made in Bangladesh and is subject to the exclusive legal power of the Courts of Bangladesh.Forwarding this prospectus to any person resident outside Bangladesh in no way implies that the issue is made in accordance with the laws of that country or is subject to the jurisdiction of the laws of that country. A copy of this prospectus may be obtained from the Corporate Head Office of BSRM Steels Limited, Alliance Financial Services Limited, South Asia Capital Limited, the Underwriters and the Stock Exchanges where the securities will be traded. 10 Issuer Issue Managers Alliance Financial Services Limited BSRM Steels Limited South Asia Capital Limited Declarations and Due Diligence CertificatesDeclaration about the Responsibility of the Directors, including the CEO of the Company BSRM Steels Limited in Respect of the Prospectus This prospectus has been prepared, seen and approved by us, and we, individually and collectively, accept full responsibility for the legitimacy and accuracy of the statements made, information given in the prospectus, documents, financial statements, exhibits, annexes, papers submitted to the Commission in support thereof, and confirm, after making all reasonable inquiries that all conditions concerning this public issue and prospectus have been met and that there are no other information or documents the omission of which make any information or statements in this misleading for which the Commission may take any civil, criminal or administrative action against any or all of us as it may deem fit. We also confirm that full and fair disclosure has been made in this prospectus to enable the investors to make a well-informed decision for investment. Sd/ Alihussain Akberali Chairman Sd/Zohair Taherali Director Sd/Aameir Alihussain Managing Director*Sd/Tehseen Zohair T aherali Director Sd/Sabeen Aameir Director Consent of the Directors to Serve We hereby agree that we have been serving as Directors of BSRM Steels Limited and confirm to continue to act as Directors of the Company. Sd/ Alihussain Akberali Chairman Sd/Zohair Taherali Director Sd/Aameir Alihussain Managing Director* Sd/Tehseen Zohair Taherali Director Sd/Sabeen Aameir Director * Mr. Aameir Alihussain is also a shareholder Director of the company. Declaration about filing of Prospectus with the Registrar of Joint Stock Companies Firms A dated and signed copy of the Prospectus has been filed for registration with the Registrar of J