Savar Refractories directors seek 58% discount on public shares in market exit bid

The directors of the brick manufacturer Savar Refractories want to buy out its shares held by general and institutional investors at a 58.4% discount on the market price in order to complete the firm's exit from the stock market.

Currently, each share is priced at Tk229.7 at the Dhaka Stock Exchange (DSE) but the directors have offered Tk95.5, according to the company's stock exchange filing on Sunday.

General and institutional investors jointly hold 6.87 lakh shares, which is 49.3% of Savar Refractories' total 13.93 lakh shares.

The market value of the shares stands at Tk15.78 crore, but the directors want to buy them at Tk6.56 crore.

In order to secure the approval of the general shareholders in this regard, the company will hold an annual general meeting (AGM) on 18 February. The final decision is subject to the approval of the Bangladesh Securities and Exchange Commission (BSEC).

Owing to its back to back losses and overall poor condition of business, Savar Refractories in August last year decided to voluntarily exit the stock market.

Lutful Tahmina Khan, wife of Home Minister Asaduzzaman Khan, is currently the chairperson of Savar Refractories. Their son Safi Modassir Khan and daughter Shafia Tasnim Khan are the managing director and director, respectively.

Of the total shares, sponsor-directors jointly hold 50.7%, institutional investors 7.2%, and general investors 42.1%.

According to the company financials, its total equity and liabilities stood at Tk22.35 crore on 30 June 2022. Its net asset value, which is revaluation asset value minus liabilities, stood at Tk13.08 crore.

All six pending AGMs in a day

Since 2017, the company has not held an AGM but it did post its annual financials regularly.

Now, after the order from the court, the company will now hold all its pending AGMs on 18 February through a digital platform.

As per its Sunday's stock exchange filing, Savar Refractories will present a special agenda of changing its name from Savar Refractories Limited to Savar Refractories PLC in its 40th AGM which was supposed to be held in FY22.

Company financials

Since 2014, the company has been incurring heavy losses and failing to pay dividends to its shareholders.

In the 2021-22 fiscal year, although its revenue inched up to Tk3.99 crore from Tk3.97 crore in the previous fiscal, its losses deepened to Tk1.38 crore from a Tk12.84 lakh in FY21.

In the first half of the ongoing fiscal, it incurred a loss of Tk22.25 lakh.

Savar Refractories was listed with the stock exchanges in 1988.