City Sugar Industries Limited has received approval from the Bangladesh Securities and Exchange Commission (BSEC) to issue a Tk1,300 crore mortgage-backed, non-convertible, zero-coupon bond.
The company plans to use the proceeds to settle existing liabilities with banks and financial institutions.
The bond, with a three-year tenure, is priced at Tk13 lakh per unit and is expected to offer a discount rate of approximately 13.50%.
The bond is secured by the company’s assets and will not be exchanged for company shares, while no periodic interest will be paid. Instead, the bond is issued at a discount, and investors will receive the full face value at maturity.
Private placement will be used for the issuance, targeting corporate institutions, high-net-worth individuals, banks, and insurance companies.
BRAC EPL Investments Limited will serve as the trustee, while BRAC Bank PLC will act as the arranger. In addition, the bond will be listed on the Alternative Trading Board, providing further liquidity for investors.
This bond issuance is a strategic move by City Sugar to streamline its financial position while also offering a solid investment opportunity to institutional and individual investors.
