Seven people including chairman of Asiatic Laboratories fined
Capital market regulator Bangladesh Securities and Exchange Commission (BSEC) has fined 7 people including the chairman of Asiatic Laboratories Limited, whose Initial Public Offering (IPO) application has been suspended. The fine has been imposed for undermining the interests of investors by providing false information.
Recently the penalty was imposed through 7 separate orders signed by BSEC Commissioner Dr. Rumana Islam. Mohammad Rezaul Karim, executive director and spokesperson of the organization, confirmed the fine to Barta 24 on Sunday (November 12).
According to sources, Asiatic Laboratories' chairman Tahmina Begum has been fined Tk. 50 lakh by the capital market regulatory body. At the same time, the managing director of the company, Monir Ahmed, was fined Tk. 75 lakh. Three directors Maqsood Ahmed, Selina Ahmed and Sadia Ahmed were also fined Tk. 50 lakh each. Besides, company secretary Ishtiaq Hossain and chief financial officer (CFO) of Asiatic Laboratories Jayant Kumar Biswas were also fined Tk. 25 lakh by BSEC.
It is known that the Capital Market Regulatory Authority approved the IPO of Asiatic Laboratories on August 31 last year to be listed in the stock market in the book-building method. The company was supposed to withdraw a total of Tk. 95 lakh from the stock market. The auction was held from October 10 to October 13, 2022 to determine the company's cut-off price. The IPO was to issue shares to general investors at a discount of 30 per cent from Asiatic Laboratories' cut-off price or Tk. 20, whichever is lower.
According to sources, after the approval of the IPO, there were allegations of irregularities against Asiatic Laboratories. The company quoted 14 times the value of its assets in the pre-IPO prospectus to raise around Tk. 100 crore. In addition, many inconsistencies were found in the company's financial reports. In view of this, BSEC suspended the IPO of Asiatic Laboratories on January 15 this year.
According to the BSEC order, Asiatic Laboratories has undermined the interests of investors by providing false information regarding land deeds to the commission as per the terms of the initial public offer (IPO) approval letter. Such activities of the company have violated Sections 2F and 18 of the Securities and Exchange Ordinance, 1969. All directors representing Asiatic Laboratories are liable for failure to comply with the Securities Act and the rules issued thereunder and are an offense punishable under Section 22 of the Securities and Exchange Ordinance, 1969.
Separate orders mentioned that Asiatic's directors, chief financial officer (CFO) and company secretary were fined under the powers conferred by Section 22 of the Securities and Exchange Ordinance, 1969, as deemed necessary. BSEC has directed to pay the penalty within 30 working days of the order.
When asked about this, BSEC spokesperson Mohammad Rezaul Karim told Barta 24 that various reports were published in the media after the IPO approval of Asiatic Laboratories. Based on these reports BSEC investigated. The Commission took the action only after complaints and hearings from representatives of Asiatic Laboratories. Till now the IPO of the company is on hold, a decision will be taken about their IPO later.