Ifad Autos allowed to divert Tk300cr to associate firm
Ifad Autos Limited, an authorised dealer and assembler of Ashok Leyland's vehicles, has got exemption from the Bangladesh Securities Exchange Commission's (BSEC) rules so it can divert Tk300, which will be raised through the issuance of bonds, to its associate firm.
As per the BSEC rules, a company is not allowed to invest funds raised through bonds in its associates or subsidiaries or sister concerns.
But deeming it appropriate, the commission in a recent notice said Ifad Autos Limited should be exempted from the rules of the BSEC in the interest of investors and the securities market.
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Ifad Autos will raise Tk300 crore through issuance of secured fully redeemable coupon bearing floating rate bonds, but it will invest the amount in its associate company named Ifad Multi Products Limited. And, the investment amount shall be subscribed in ordinary shares at face value with prior approval of the commission.
In 2021, Ifad Autos bought out 80% share of Ifad Multi Products Limited for Tk80 crore.
Ifad Autos reported that its profit jumped by 149% on its associate company's income in the third quarter of FY22.
According to the company's January-March quarter financial statement, Ifad Autos' net profit grew to Tk32.39 crore.
