The Dhaka Stock Exchange (DSE) on Monday agreed to sell 25% of its ordinary shares to a Chinese consortium comprised of the Shanghai Stock Exchange (SSE) and Shenzhen Stock Exchange (SZSE).
The share purchase agreement (SPA) was signed at a Dhaka hotel, with Finance Minister AMA Muhith in attendance as the chief guest.
Wang Jianjun, president and CEO of SZSE, and Pan Xuexian, chair of the SSE Supervisory Board, signed the agreement on behalf of the Chinese consortium, while DSE Managing Director KAM Majedur Rahman signed the agreement on behalf of his organization.
Speaking at the signing ceremony, the finance minister said he hoped the Tk947 crore agreement would be beneficial for both countries.
“The Chinese stock exchanges have a lot of expertise and success (so) we should try to follow their example and let them make a difference in our stock markets,” Muhith said.
“The Chinese consortium could also benefit as they are partnering a country whose capital market is finally getting organized and established.”
The Bangladesh Securities and Exchange Commission (BSEC) chairman, M Khairul Hossain, said the development of the DSE was the result of significant efforts taken from 2011-2013 to reform the laws around the Dhaka and Chittagong stock exchanges.
“In the last few years, we have taken a series of reforms for the betterment of the stock market (and) as a result, the stock market is now more transparent and accountable to investors and stakeholders,” he said.
“We hope that the partnership with the Chinese consortium will contribute significantly to the further development of the stock market.”
BSEC finally approved the DSE proposal to partner with the Chinese consortium on May 3, following necessary amendments and three months of uncertainty over the issue.
According to the SPA, the consortium will hold 25% – equivalent to 450,944,125 ordinary shares – of DSE at Tk21 each in order to partner with the bourse.
The consortium has also offered Tk3.7 crore on top of the initial Tk947 crore, for infrastructural and technological development.
In addition, they have proposed to develop an SME market, assist in product diversification, and jointly operate the V-Next alliance program in Bangladesh.
Furthermore, the DSE is being offered assistance in mapping information disclosure and investor service automation framework, developing human resources, and technological support to develop the DSE portfolio.
Speaking at Monday’s signing ceremony, Wang Jianjun, president and CEO of SZSE, said China and Bangladesh are both developing countries with similar national conditions and development goals.
“China will stick to the national policy of opening up and the principal of development with open doors, actively promoting cooperation with the belt and road countries,” he said.
The DSE chairman, Professor Abul Hashem, and other top officials of the securities regulator and the bourse were also present at the signing ceremony.
Source: Dhaka Tribune.
