Paramount Textile, a sister concern of Paramount Group, has decided to issue 150 million fully redeemable non-convertible cumulative preference shares.
Preference shares are shares of a company's stock with dividends that are paid out to shareholders before common stock dividends are issued.
Through issuing shares, the textile maker will raise a fund worth Tk 1.50 billion for five-year tenure, the company said in a filing with the Dhaka Stock Exchange (DSE) on Tuesday.
It would be issued through private placement among the potential investors with a face value of Tk 10 each.
With the funds, Paramount Textile would finance the upcoming project expansion and pay-off a portion of high-cost short term loan, according to the filing.
The share issue is subject to approval of Bangladesh Securities and Exchange Commission (BSEC) and extraordinary general meeting (EGM) of the company.
The EGM will be held on March 12 at 11:00am through digital platform. The record date for the EGM is set on February 16.
The said preference shares shall be fully redeemable cumulative non-convertible within five years and to be redeemed the principal amount by yearly equal installments commencing from the first-year end from the date of disbursement.
Dividend will be paid semi-annually on an arrear basis at a fixed rate.
Each share of the company, which was listed on the DSE in 2013, closed at Tk 98.10 on Tuesday, losing 1.41 per cent over the previous day. Its shares traded between Tk 40.10 and Tk 109 in the last one year.
The textile maker's second quarter (Q2) earnings per share (EPS) stood at Tk 1.52 for October-December 2021 as against Tk 0.95 for October-December 2020.
The company has also reported EPS of Tk 2.97 in the six months for July-December 2021 as against Tk 2.32 for July-December 2020.
Paramount Textile disbursed 20 per cent cash and 5.0 per cent stock dividend for the year ended on June 30, 2021. In 2020, it provided 15 per cent cash and 5.0 per cent stock dividend.
The company's paid-up capital is over Tk 1.62 billion and authorised capital is Tk 2.0 billion, while the total number of securities is 162.83 million.
The sponsor-directors own 60.95 per cent stake in the company, while institutional investors own 9.24 per cent, foreign investors 4.10 per cent and the general public 25.71 per cent as on December 31, 2021, the DSE data shows.
Incorporated in 2006, Paramount Textile produces and delivers woven fabrics, nominated by world renowned retails and brands.