Beximco to raise Tk 1,500 crore thru zero-coupon bonds

Beximco Ltd, one of Bangladesh's leading conglomerates, is set to raise Tk 1,500 crore through the issuance of a zero-coupon bond. 

The company has also signed a joint venture development agreement with Sreepur Township Ltd, according to a filing on the Dhaka Stock Exchange. 

Beximco's board, in a meeting on March 10, approved the issuance of the "Beximco 1st Zero Coupon Bond", to repay the company's existing loans and invest in a joint venture with Sreepur Township. 

The bond, subject to the approval of the Bangladesh Securities and Exchange Commission (BSEC), is a secured, redeemable, non-convertible, non-tradable zero-coupon bond with a discount rate of 15 percent. 

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.

Beximco's joint venture with Sreepur Township is for the development of "Mayanagar," a mixed-use, multipurpose affordable real estate project, located on a 100-acre land on the Nabinagar-Chandra Highway. 

The housing project will be a fully secured, gated, and self-contained township comprising 18,000 apartments and will offer a comprehensive range of facilities including healthcare, education, entertainment, sports, and recreation, along with all necessary civic and lifestyle amenities. 

The commercial space, spanning 5 million square feet, will include serviced apartments, a hotel, offices, a convention centre, and a shopping mall. The entire project is set to be developed as a green and eco-friendly township.

Currently, Beximco owns 75 percent of the project land, with Sreepur Township owning the remaining 25 percent, and the profits will be shared accordingly. 

Beximco said that a globally renowned architectural and engineering consultancy firm has been appointed for the design, development, and supervision of the project on a turnkey basis. An international engineering, procurement, and construction (EPC) contractor will be appointed for the project's implementation.

A turnkey business is an arrangement where the provider assumes responsibility for all required setup and ultimately provides the business to the new operator only upon completion of the aforementioned requirements.

Shares of Beximco were unchanged as of 1:10 pm today.