BANGLADESH Law and Practice Contributed by: Nasirud Doulah and Amina Khatoon, Doulah & Doulah
eral. However, according to listing regulations of the current active stock exchanges, once a consortium ends up owning 90% of the shares in the target, it can forcefully purchase the remaining 10% at the price below (whichever is highest): • the last trade price; • the weighted average price over the last six months; or • NAV per share, as per the latest financial state - ments. 6.11 Irrevocable Commitments Non-Listed Companies There are no restrictions on a purchasing company obtaining irrevocable commitments to tender or vote from the principal shareholders of the non-listed target companies. Listed Companies Although such commitments are not common for listed companies, as regulators do not view them favourably, in a negotiated deal (whether on or off the exchange), parties may negotiate to have such pro - visions incorporated into the share purchase agree - ment before a public offer/notice is floated. This may include arrangements regarding board composition within the BSEC-provided framework, as well as cer - tain reserve matters critical to the business and the composition of the company. If an acquisition of shares in a publicly listed compa - ny triggers the 10% threshold under the Bangladesh Securities and Exchange Commission (Substantial Acquisition of Shares and Takeovers) Rules, 2018, as outlined in 4.2 Material Shareholding Disclosure Threshold , the public announcement of an open offer must be made before acquiring any further shares in the company. In the event of a negotiated deal, such an announcement must be made within the following day, as soon as a definitive agreement is entered into with any sponsor or other shareholder, before acquir - ing any further shares in the company. 7. Disclosure 7.1 Making a Bid Public
Such a public announcement must be made by shar - ing information in the prescribed format with the rele - vant stock exchanges, which then publicise it instantly upon receipt. The announcement is also required to be sent to BSEC. 7.2 Type of Disclosure Required The announcement, as stated in 7.1 Making a Bid Public , is required to contain the following: • target and targeted number of shares; • purpose, conditions and proposed value of shares; • detailed identification of the purchaser, including nationality; • relationship with sponsors, directors and other significant shareholders and with the capitalisation of the company; • details of any memorandum of understanding or agreement already executed and terms contained therein in connection with the purchase of shares; • where the purchaser is a sponsor, director, place - ment holder, or other significant shareholder, a declaration must be provided confirming compli - ance with applicable requirements, including the obligation to maintain a minimum 30% aggregate shareholding by sponsors and directors; • acquisition offer date and the date until which the offer is valid; • settlement process, including date, time and method; • in case of non-cash settlement, the valuation consultant details, including experience, date and method; • planned share acquisition proportion from each class of shareholders, such as sponsors, directors, placement holders, or other significant sharehold - ers or from the public; • declaration as to approval from the board of the company, if applicable; and • any terms pertaining to other laws, such as foreign exchange regulations. Another declaration from the broker is required to confirm the funds’ availability. These are disclosed publicly through the exchange.
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