Associated Oxygen Limited continues to report the utilisation of its 2020 initial public offering (IPO) proceeds nearly four years after the original deadline, despite the Bangladesh Securities and Exchange Commission (BSEC) rejecting the company’s request for an additional extension.
The company raised Tk15 crore through its IPO in September 2020. According to the IPO prospectus, Associated Oxygen was required to submit monthly reports on fund utilisation until 23 October 2022. The company later received a five-month extension up to March 2023.
It subsequently sought another six-month extension until 30 September 2023, but the BSEC rejected the request on 16 November 2023.
Despite the rejection, Associated Oxygen’s latest auditor’s certificate dated 31 July 2026 shows that the company continues to report the status of its IPO proceeds. Dhaka Stock Exchange (DSE) records also show that the company submitted monthly utilisation reports throughout 2026.
Auditor FAMES & R Chartered Accountants said the company had utilised Tk14.76 crore, or 98.39 per cent, of the Tk15 crore raised from investors.
However, Tk24.12 lakh of the IPO proceeds remained unused, with no expenditure made from the funds during July.
The auditor said Tk2,321.70 remained in the designated IPO account with BRAC Bank, while Tk24.09 lakh was held in the company’s own bank account, from which the remaining unused fund would be adjusted.
Associated Oxygen had allocated Tk6.82 crore of the IPO proceeds for constructing a new plant shed and store shed. The company spent Tk6.82 crore on the project, exceeding the approved allocation by Tk15,791.
Another Tk4.24 crore was allocated for new plant and machinery, which was fully utilised. The company used Tk2 crore for bank loan repayment and Tk1.70 crore for IPO-related expenses against an approved allocation of Tk1.94 crore.
The utilisation report showed that the company placed Tk9.70 crore of the IPO proceeds in three-month fixed deposits with NRB Commercial Bank in November 2020 at an annual interest rate of 9 per cent. The fixed deposits were later encashed in phases as the funds were used.
The auditor also found that some expenses were initially paid from the company’s own bank account and later adjusted against IPO proceeds. These included part of the expenditure for the plant shed, bank loan repayment and IPO-related expenses.
Including interest income of Tk33.79 lakh, total funds available from the IPO proceeds and related interest stood at Tk15.34 crore, while cumulative utilisation reached Tk15.10 crore.
The auditor said the expenditures were made for purposes specified in the IPO documents and that assets purchased, imported or constructed using the proceeds were acquired through proper procedures and at reasonable prices.
Supporting documents and vouchers were also reconciled with relevant bank statements, according to the auditor.
Although only a small portion of the IPO proceeds remains unused, the prolonged reporting timeline highlights that the utilisation process has continued well beyond the deadline originally set for the 2020 fundraising.
