Dhaka Stock Exchange Approves China’s Bid, Rejects India’s Offer
Bangladesh has decided to sell a 25 percent stake in the Dhaka Stock Exchange (DSE) to a Chinese consortium, rejecting a rival bid from a consortium of India’s National Stock Exchange, Nasdaq of the US and others.
The directors of Bangladesh’s premier bourse decided to accept the Chinese consortium’s proposal on 10 February as it looked acceptable to them from the financial and technological aspects.
They gave the final nod to the proposal by the consortium of Shenzhen Stock Exchange and Shanghai Stock Exchange at a meeting of the board on Monday evening, DSE managing director K A M Majedur Rahman told reporters in Dhaka.
They would “soon” send the proposal to the regulators, the Securities and Exchange Commission or SEC, for endorsement, he added.
But according to a Financial Times report, even though DSE has accepted the offer from the Chinese consortium to purchase a stake in DSE at 22 takas (Rs17.12) per share, considerably higher than the 15 takas (Rs11.67) per share offered by the NSE consortium, India is aggressively lobbying with the market regulator in Bangladesh to reconsider its decision.
The Bangladeshi Securities and Exchange Commission (BSEC) is yet to provide final approval on the deal.
Shanghai and Shenzhen stock exchanges are among the top bourses in the world boasting $3.5 trillion and $2.2 trillion market capital respectively.
The market capitalization of the is over $51.42 billion.
A consortium of India’s National Stock Exchange, Frontier Bangladesh and Nasdaq stock market of the US took part in the bidding to become DSE’s partners. And according to Bloomberg, along with a stake, India wanted two director-level positions in the Dhaka Stock Exchange.
India is hopeful that Bangladesh will reconsider its decision considering close ties between the two countries, according to Business Standard.
Fuelled by encouraging growth in garment exports, stocks in the DSEX index have soared nearly 8 percent in the last one year. Bangladesh’s economy has been growing at a rate of 7 percent annually – though this has been little noticed in neighbour India, obsessed as it is with its own growth story.
Dhaka Stock Exchange (DSE) and Chittagong Stock Exchange (CSE) are the two stock exchanges of Bangladesh.
The Kootneeti - South Asia
The views and opinions expressed in this article are those of the author and do not necessarily reflect the views of The Kootneeti Team