Rancon Motorbikes, the supplier of Suzuki-branded motorcycles in Bangladesh, is set to raise Tk 150 crore by issuing zero-coupon bonds.

The Bangladesh Securities and Exchange Commission approved the bond in a meeting at its own office in Agargaon on Thursday.

A zero-coupon bond is a debt security that does not pay interest but instead trades at a deep discount. It will render a profit at maturity when the bond is redeemed for its full-face value.

The face-value of the bond is Tk 208 crore and its discount rate is 11-12 percent. This fully redeemable, non-convertible bond will be issued to institutional investors and high-net worth individual investors, and will be listed at the alternative trading board of stock exchanges.

With a face-value of each unit at Tk 1 lakh, the bond proceeds will help Rancon Motor repay bank loans. 

Established in 2012, Rancon Motorbikes is the sole authorised distributor to market Japanese motorbike brand Suzuki in Bangladesh.

City Bank Capital Resources is the arranger of the bond.