Premier Cement gets BSEC nod to raise Tk161cr through preference shares
BSEC approved the plan to issue 322 fully redeemable, non-convertible, non-participating and cumulative preference shares of Tk50 lakh each at par, totalling Tk161 crore.
Premier Cement Mills PLC has received regulatory approval to raise Tk161 crore through the issuance of preference shares, as the company moves to restructure its balance sheet and reduce rising finance costs.
The Bangladesh Securities and Exchange Commission (BSEC), in a letter dated 16 February, approved the cement maker's plan to issue 322 fully redeemable, non-convertible, non-participating and cumulative preference shares of Tk50 lakh each at par, totalling Tk161 crore, under the Securities and Exchange Commission (Issue of Capital) Rules, 2001.
According to the company, the proceeds from the preference shares will be used to restructure its existing balance sheet and repay high-cost short-term liabilities, in line with a decision taken by its board of directors and later endorsed by shareholders at an extraordinary general meeting.
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Following the disclosure filed with the Dhaka Stock Exchange today (17 February), Premier Cement's share price remained unchanged at Tk39.30.
Preference shares are a class of stock that entitles holders to receive dividends ahead of ordinary shareholders. In the event of liquidation, preference shareholders also have priority over common shareholders in claims on company assets.
The approval comes after an earlier setback. In June 2025, the BSEC rejected Premier Cement's initial application to issue the preference shares, citing the absence of required provisions in the company's Memorandum of Association.
The company later amended the memorandum and submitted a fresh application in October 2025.
In a letter issued on 5 October, the commission asked the bourse to provide its opinion on the proposed issuance within 15 working days. The DSE later gave its consent, paving the way for the commission's final approval.
Explaining the move, the company said rising bank lending rates had significantly increased its financing burden.
"The interest rate on bank loans has increased significantly. That is why the company is going to issue preference shares," it said in a statement, adding that lending rates from local banks have exceeded 14%.
Repaying part of its existing loans would help cut interest expenses, it added.
Financial disclosures show Premier Cement's performance weakened in the first half of FY26. Revenue for the July-December period slipped to Tk1,059 crore, while net profit fell 49% year-on-year to Tk1.97 crore.
The company attributed the sharp decline mainly to higher finance costs.
As of December 2025, Premier Cement reported Tk679 crore in long-term loans and Tk1,693 crore in short-term borrowings, alongside Tk24 crore owed to directors.
Finance costs rose to Tk122 crore during the period, up from Tk89 crore a year earlier, largely due to elevated interest rates.
The fresh capital injection is expected to ease liquidity pressure and strengthen the company's financial structure amid a challenging operating environment.
