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Renata PLC plans to shed its loan burden further by issuing preference shares, having witnessed profit erosion in recent quarters due to a jump in its finance costs.
The leading drug maker will repay part of its bank loans with Tk 3.25 billion to be raised through preference shares against the backdrop of rising interest rates.
The decision was taken at a board meeting held on Saturday. Share issuance is subject to approval from the shareholders and Bangladesh Securities and Exchange Commission (BSEC).
To receive shareholders' approval, the company will hold an extraordinary general meeting (EGM) scheduled to be held on January 12, 2025. The record date is on December 12.
Preference share, also known as preferred stock, is an exclusive share option which enables shareholders to receive dividends announced by the company before the equity shareholders.
The nature of preference shares is – non-cumulative, redeemable or fully convertible and non-participative preference shares.
Renata is one of the fastest-growing drug makers in Bangladesh, which has been heavily focused on research and development (R&D) of complex generics for several years.
The drug maker manufactures and markets medicines, nutritional products, and vaccines for humans along with veterinary medications.