Substantial Acquisition of Shares in Bangladesh 2026: Takeovers of Listed Companies under the BSEC Rules 2018

Substantial acquisition of shares Bangladesh: the 2026 position

Substantial acquisition of shares Bangladesh law regulates in a way that surprises many foreign bidders. There is no 25 per cent or 30 per cent trigger that forces an acquirer to make a general offer to every shareholder. Instead, the Bangladesh Securities and Exchange Commission (Substantial Acquisition of Shares and Takeovers) Rules 2018 build a disclosure regime around a single 10 per cent line: cross it, or buy more once you are above it, and you must publish a prescribed declaration through the stock exchange before a single share changes hands.[1]

This guide is written for acquirers, sellers, sponsors, boards and their advisers dealing with a company listed on the Dhaka or Chittagong Stock Exchange. It covers the 2018 Rules in detail: scope and exemptions, the 10 per cent threshold, creeping acquisitions, the three acquisition routes, the declaration, consideration, withdrawal, rescue takeovers of financially weak companies and penalties. It also explains how the Rules sit alongside the Companies Act 1994, foreign exchange rules for non-resident buyers, sector caps and the draft Corporate Restructuring Rules 2026. Deal structuring and share-purchase mechanics are covered in our separate acquisition process guide.

Summary: In Bangladesh, a person who acquires 10 per cent or more of the voting shares of a listed company, or who already holds 10 per cent and acquires more, must file a declaration in the prescribed form with the exchange through a broker, and no trade may be executed until the exchange has published it. The 2018 Rules impose no mandatory general offer and no statutory minimum offer price.

Key point: The 2018 Rules repealed the 2002 takeover rules, which had required a public offer to other shareholders, a minimum price linked to market highs and a four-week offer period. Today the regime is disclosure-led: protection for minority shareholders comes from transparency, sponsor shareholding rules and BSEC's case-by-case conditions, not from a compulsory exit offer.

At a glance

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Table of Contents

The legal framework for listed company acquisitions

The core of substantial acquisition of shares Bangladesh law is a single BSEC instrument. The Bangladesh Securities and Exchange Commission (BSEC) made the 2018 Rules under section 24 of the Bangladesh Securities and Exchange Commission Act 1993, after prior publication. The notification is dated 3 June 2018 and appeared in the Bangladesh Gazette on 10 June 2018.[1] The official title is in Bangla, and English translations vary; you will see the rules described as the Substantial Acquisition of Shares and Takeovers Rules or the Substantial Share Acquisition, Takeover and Control Rules. They are the same instrument.

Rule 19 repealed the Securities and Exchange Commission (Substantial Acquisition of Shares and Takeovers) Rules 2002, while saving acts, orders, applications and investigations taken under them.[1] As at 20 October 2026, BSEC's published list of acts, rules and regulations shows them as the operative takeover instrument for every listed company, and we have not found any gazetted amendment to them. The Commission's draft Corporate Restructuring Rules 2026, discussed below, expressly leave listed-company takeovers to the 2018 Rules.[9]

Key definitions

An "acquirer" is any person who, alone or together with persons acting in concert, acquires or offers to acquire voting shares, or securities convertible into voting shares, of a company. "Substantial" means 10 per cent or more, or any other figure the Commission fixes from time to time. A "negotiated deal" means a transaction carried out in the manner the exchange prescribes for negotiated deals.[1] Undefined terms take their meaning from the Securities and Exchange Ordinance 1969, the 1993 Act, the Companies Act 1994, the Depository Act 1999 and the Exchanges Demutualization Act 2013.

Which companies and securities are covered

Under rule 3(1), the Rules apply only to voting shares, and securities convertible into voting shares, that are listed on an exchange.[1] An acquisition of a private company, or of an unlisted public company, sits outside them; those deals turn on the Companies Act, the articles and the foreign exchange rules. Because convertibles count, a buyer that holds convertible bonds or preference shares must model its holding on a converted basis before it approaches the line.

Acquisitions the 2018 Rules do not catch

Rule 3(2) lists eleven routes by which voting shares of a listed company may be acquired without triggering the Rules.[1] The exemptions are narrower than they first appear, and each one deserves to be read against the actual transaction rather than its label.

• applications for shares under a prospectus in a public issue;
• acquisitions as an underwriter;
• purchases by a BSEC-registered merchant banker, stock broker or stock dealer in the ordinary course of business on behalf of a client, although the client itself is not exempt;
• acquisitions by a registered market maker or a registered alternative investment fund;
• acquisitions in managing the assets of a BSEC-approved mutual fund;
• rights and bonus issues;
• transfers by inheritance or under a court order or decision;
• transfers under a Commission order, or with Commission approval under another law; and
• transfers by approved gift.

Two points matter in practice. First, the broker exemption protects the intermediary, not the beneficial buyer, so an acquirer cannot accumulate a stake through brokers and claim it is exempt. Second, the exemption for transfers approved by the Commission under another law is the route through which many sponsor-to-buyer block transfers are channelled, but approval for one purpose does not discharge disclosure obligations that arise for another.

Substantial acquisition of shares Bangladesh threshold: the 10 per cent line

The trigger is simple. A person who holds less than 10 per cent, or no shares at all, and who wishes to acquire shares that would take the total holding to 10 per cent or more must file a declaration. So must a person who already holds 10 per cent or more and wishes to acquire further shares.[1] The same structure is repeated for each of the three acquisition routes in rules 4, 5 and 6.

Creeping acquisitions

Bangladesh has no "creeping acquisition" allowance for a listed company of the kind some markets use, where a controller may add a fixed percentage a year without a fresh offer. Above 10 per cent, every further acquisition needs its own prior declaration and publication, whatever its size.[1] A holder at 12 per cent who buys a further 0.5 per cent on the exchange is in the same position, procedurally, as a newcomer crossing the line. Stakebuilding above 10 per cent is therefore visible to the market at each step.

Acting in concert and aggregation

Because the definition of acquirer includes persons acting in concert, holdings of family members, group companies and investment vehicles that co-operate to acquire shares should be aggregated for threshold purposes.[1] The Rules do not set out a list of presumed concert parties, so the analysis is fact-driven. Assume BSEC will look through nominee and connected structures, and document why any party is treated as independent.

Beneficial ownership returns under the 1969 Ordinance

The takeover declaration sits on top of a separate statutory duty. Section 12 of the Securities and Exchange Ordinance 1969 requires directors and officers of an issuer, and every person who is directly or indirectly the beneficial owner of more than 10 per cent of any class of listed equity securities, to submit returns of beneficial ownership to the Commission in the prescribed form and at the prescribed times.[3] An acquirer above 10 per cent therefore has continuing reporting duties after completion, not just a one-off declaration.

Is there a mandatory open offer under substantial acquisition of shares Bangladesh rules?

No. This is the most common misunderstanding about the substantial acquisition of shares Bangladesh regime, and it often comes from reading Indian or Pakistani takeover codes across the border. The 2018 Rules contain no obligation to make a general offer to all shareholders at any level of holding, whether 25, 30 or 50 per cent, and no statutory minimum offer price.[1] An acquirer can buy control from sponsors in a negotiated deal without extending the same opportunity to public shareholders, provided it follows the declaration procedure and obtains any other approvals the deal needs.

What the repealed 2002 Rules required

The position was different before 2018. Under the 2002 Rules, as amended, a person crossing 10 per cent made a public announcement of an offer, generally within three working days of finalising the deal. The offer had to remain open for at least four weeks, and the minimum price in a negotiated acquisition was the higher of the highest market price on the exchange and the average market price over the six calendar months before the announcement.[2]

The 2002 Rules also allowed competing offers within two weeks, restricted the target's directors from selling capital assets or issuing new voting shares during the offer, and required the acquirer to buy out remaining public shareholders who offered their shares if the public holding fell below 10 per cent.[2]

What this means for minority shareholders

With those features gone, minority protection now rests on four other pillars: prompt and detailed disclosure before trading, the rule that cash paid to one class must be offered to the rest where an agreement provides for cash, sponsor and director shareholding requirements, and the conditions BSEC attaches when it approves block transfers. Public shareholders who want an exit at a control premium have no statutory right to one. For a buyer, that lowers the cost of control. For a seller, it means the premium is a matter for negotiation with the sponsors alone.

Lawyers and analysts sometimes still describe the 10 per cent declaration as an "open offer", and practice guides refer to a public announcement before further shares are acquired.[4] The label is harmless provided everyone understands that, under the 2018 text, the declaration is an announcement of intended acquisition, not an offer that every shareholder may accept.

Three routes to a substantial stake

The Rules distinguish between three ways of acquiring a substantial stake, and the procedure, pricing and deposit rules differ for each.[1] The table below summarises them before we look at each in turn.

Route 1: cash purchases through the exchange (rule 4)

Where the acquirer buys for cash on the exchange's trading system, it files the Schedule 1 declaration with the exchange on which the company is listed, through its stock broker or merchant banker. The exchange examines it and immediately publishes it as online news. No trade may be executed before publication, and the acquirer must then give its broker an unconditional buy order at the prevailing market price.[1] Schedule 2 also provides a form of broker certificate confirming that the acquirer has deposited the funds and placed its buy order, to be executed after publication without further contact with the acquirer.

Route 2: negotiated deals on the exchange (rule 5)

Most control transactions with sponsors run through the exchange's negotiated-deal mechanism. The acquirer files the declaration through its broker, the exchange publishes it, and no trade under the declaration may be executed with anyone before publication. The price is whatever the buyer and seller agree.[1] The seller's broker also gives a Schedule 2 certificate confirming that the shares sit in the seller's beneficial owner account and that it will complete the trade after publication without further contact with the seller.

Route 3: non-cash acquisitions outside the trading system (rule 6)

Share swaps and other non-cash deals outside the trading system carry the heaviest procedure. The acquirer must sign a detailed agreement with the seller; the seller must give its broker an irrevocable sell order; and the seller's broker must freeze the shares and give the exchange a Schedule 2 assurance. The acquirer then lodges the completed declaration, a copy of the agreement and a bank draft or pay order in favour of the exchange equal to 20 per cent of the total consideration.[1]

If the transaction does not complete for any reason, the exchange forfeits the deposit and transfers it to its investor protection fund. If it completes as declared, the deposit is returned.[1] That forfeiture risk makes conditionality critical: an acquirer should not lodge a rule 6 declaration until regulatory approvals that could block completion are in hand or are very close.

The declaration: contents, timing and publication

Schedule 1 prescribes the declaration's contents for all three routes.[1] It is a public document, published as exchange news, and the market reads it closely. It must cover:

• the company's name and the number of shares the acquirer intends to acquire;
• the purpose and terms of the acquisition and the proposed price;
• the acquirer's full identity, including nationality;
• its existing shareholding and its relationships with the company's shareholders, sponsors and directors;
• details of any agreement or memorandum of understanding under rules 5 and 6;
• whether declarations required of sponsors, directors or placement holders have been made;
• the date of the offer and the period within which the acquisition will be made, and when and how consideration will be paid;
• for a rule 6 deal, the valuation method for the non-cash consideration and the valuer's name, address and experience;
• the number of shares to be acquired from sponsors, directors or the public;
• any conditions imposed under the Companies Act 1994, the Bank Company Act 1991, the Financial Institutions Act 1993 or the Foreign Exchange Regulation Act 1947, and any shareholder approvals required by law; and
• any relationship with the company, its sponsors, directors, 10 per cent holders, associated companies or the prospective seller.

The next-day deadline in negotiated deals

For acquisitions under rules 5 and 6, the declaration must be notified to the exchange and the Commission within the day following the signing of the agreement or memorandum of understanding.[1] That is a tight window. The declaration should be drafted in parallel with the share purchase agreement so that it can be filed the day after signing, and the board of a listed acquirer should consider whether signing is itself price-sensitive information that must be disclosed.

Completion certificate within one week

Once the transaction is complete, the acquirer must file a Schedule 3 certificate with the exchange and the Commission within one week, confirming the date of completion and whether there was any discrepancy with the declaration. Both brokers certify completion as well.[1] Any discrepancy must be explained in an annex, so a partial fill or a change in the number of shares should be documented as it happens.

Offer price and consideration

Rule 8 allows the price for an acquisition under rules 4, 5 and 6 to be paid in cash, by transfer of shares, by a combination of the two, or in any other form acceptable to the seller.[1] There is no pricing floor. On the exchange, the buyer pays the prevailing market price; in a negotiated deal, the parties agree the price; in a non-cash deal, the valuation must be disclosed with the valuer's credentials.

The equal-cash proviso

The one equality rule in rule 8 is a proviso: where an agreement or memorandum of understanding provides for cash payment to one class of shareholders, the remaining shareholders are also entitled to be paid in cash.[1] This prevents a structure in which sponsors take cash and other sellers are paid in paper. It does not require the same price, and it does not create an offer to shareholders who are not party to the deal, but it should be built into any multi-seller transaction from the term sheet onwards.

Valuation in practice

Even without a statutory floor, price is scrutinised. A negotiated price far below market invites questions about tax and about whether the seller is a connected party; a price far above market invites questions about manipulation before announcement. Where shares are the consideration, the valuation disclosed under Schedule 1 is the document BSEC and the market will test, so a merchant banker or chartered accountant with a documented methodology is the safer choice.

Step-by-step procedure for a negotiated acquisition

The sequence below reflects a typical negotiated acquisition of a controlling block from sponsors. Timing depends heavily on the approvals the target's sector requires, and on whether the deal needs Commission approval for the transfer itself.

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Two practical points recur. First, the declaration and the transfer approval are separate: publication under the 2018 Rules does not by itself authorise a sponsor transfer that BSEC must approve. Second, the timetable for completion after publication should be agreed in the share purchase agreement, with a long-stop date that reflects the realistic approval path.

Withdrawal of an acquisition offer

Rule 10 makes a declared acquisition offer irrevocable unless something occurs beyond the offeror's control, including an act of God, that makes completion impossible.[1] Subject to that, an offer is treated as withdrawn if the offeror is an individual who dies, or whose legal heirs are unwilling to proceed; if the offeror is declared insolvent; if a corporate offeror receives a winding-up notice; if a corporate offeror is itself acquired and its new owner does not wish to proceed; if, in an on-exchange acquisition, there is no seller; or for any other reason the Commission accepts.

The acquirer applies for withdrawal through its broker, with reasons, and the exchange publishes the withdrawal in the same way it published the offer.[1] Commercial disappointment, a fall in the share price and a failure of financing are not listed grounds, and relying on the Commission's residual discretion is risky, so an acquirer should treat a declaration as a firm commitment and line up funding before it files.

Rescue takeovers of financially weak companies

Chapter 3 of the Rules contains a separate substantial acquisition of shares Bangladesh regime for buying into, and rehabilitating, a financially weak listed company.[1] It applies where a financial institution, scheduled bank or any other person or institution, alone or jointly, acquires or buys substantial shares for that purpose. A company is financially weak if it has negative net worth at year end, if its market price has been below face value for at least the last three years, if it has paid no dividend in the past five years, or if the Commission designates it.

The lead institution and the rehabilitation package

Whoever initiates the rescue is treated as the lead institution, which must be a merchant banker or fund manager and is responsible for compliance with the chapter. It fixes an acceptable price having regard to financial viability, assesses the funds required and prepares a rehabilitation package based on protecting minority shareholders, efficient management, effective revival and transparency. Any change in management must be described specifically in the scheme.[1]

Inviting bids and governance conditions

Before implementation, offers must be invited by notice in two widely circulated national dailies, one Bangla and one English. Bidders receive information on management, technology, products, shareholding pattern, financial position and five years of assets and liabilities.[1] The invitation must require a board of seven to twelve members, at least one-third drawn from minority shareholders and non-shareholder professional directors, with a chairman chosen from the professional directors; an audit committee and a remuneration committee; and a professional company secretary.

The evaluation committee must include a chartered financial analyst, cost and management accountant or chartered accountant. The selected buyer announces a formal offer at a price agreed with the lead institution, sends the terms to every shareholder with a record date and begins by offering to buy out the smallest holdings in full. Each offer requires an application to the Commission for exemption from rules 4 to 10.[1]

Rescue deals in practice

BSEC's approach to rescues is condition-heavy. In August 2023 it conditionally allowed six buyers, including five Singapore-based companies, to take 37.98 per cent of Ring Shine Textiles, including sponsor and director shares, at a negotiated price. The reported conditions included assumption of liabilities, regularisation of bank loans, Commission-nominated independent directors and placement of the transferred shares in the public category because the new owners would be shareholder-directors rather than sponsors.[7]

Sponsor and director stakes in a takeover

In most Bangladeshi takeovers the seller is the sponsor group, and the rules on sponsor holdings shape the deal as much as the 2018 Rules. Separate from the takeover declaration, a sponsor or director who intends to buy or sell must report the intended transaction to BSEC and the exchange under regulation 34(1) of the Dhaka Stock Exchange (Listing) Regulations 2015, with an irrevocable order already placed with a broker at the prevailing market price. The trade must take place within the next 30 working days, and details must be reported within one week of execution.[5]

The 2 per cent and 30 per cent conditions

BSEC's conditions on sponsor transfers show how these rules bite. In August 2026 it conditionally approved the off-market transfer of 30.78 million sponsor-director shares in Dominage Steel Building Systems, about 30 per cent of the company, to Akij Resources and two individuals, as a matched transaction under the CDBL bye-laws. The conditions required sponsor-directors to hold at least 30 per cent collectively and 2 per cent each, barred pledging of the transferred shares, required pending issues to be regularised within six months and set 30 working days for completion.[6]

A buyer of control should therefore expect to step into the sponsor shareholding obligations, to fund at least the 2 per cent individual holding for each nominee director, and to accept lock-in-style restrictions. Our guide to securities law in Bangladesh covers the wider listing obligations that follow completion.

Interaction with the Companies Act 1994

The takeover rules regulate disclosure and the trade; in a listed company acquisition, the Companies Act 1994 governs the transfer of title, the register and the board. Transfers of dematerialised listed shares settle through the depository, but board changes, filings with the Registrar of Joint Stock Companies and any change to the articles still follow company law. Our guide to share transfer in Bangladesh covers the mechanics.

Acquiring dissenting shareholders

Section 230 of the Companies Act gives a transferee company a statutory route to acquire the shares of dissenting holders. Where a scheme or contract to transfer shares is approved within 120 days by holders of three-fourths in value of the shares concerned, the transferee may, within the following 60 days, give notice to dissenting shareholders that it wishes to acquire their shares. A dissenter has 30 days to apply to court; otherwise the transferee acquires the shares on the same terms as those who approved.[8] The consideration is held in trust in a separate bank account for the shareholders concerned.

Squeeze-out and delisting after a takeover

For listed companies, practice guides report that once an acquirer group owns 90 per cent of the target, the listing regulations allow the remaining shares to be bought out at the highest of the last traded price, the six-month weighted average price and net asset value per share.[4] Delisting has consequences for sponsors, lenders and tax treatment, so model the exit path before setting the acquisition target.

Schemes and the draft Corporate Restructuring Rules 2026

Where the deal is a merger or amalgamation rather than a share purchase, the court-sanctioned scheme route applies; our guide to the merger procedure in Bangladesh explains it. On 23 May 2026 BSEC published draft Corporate Restructuring Rules 2026 for comment within two weeks.[9] The draft limits its own acquisition provisions to a listed company acquiring control of a non-listed company and states that any substantial acquisition or takeover of a listed company must comply with the 2018 Rules.

The draft would also bar schemes that facilitate a backdoor listing or reverse takeover, and would require evidence that a scheme has been approved by at least 75 per cent of general shareholders, excluding sponsors, directors and 5 per cent holders, present and voting.[9] Until the rules are finalised, treat them as a guide to BSEC's thinking rather than law.

Foreign acquirers: foreign exchange rules in a substantial acquisition of shares Bangladesh deal

A non-resident buyer must satisfy the takeover rules and the foreign exchange framework at the same time. The Schedule 1 declaration itself asks for the acquirer's nationality and any conditions imposed under the Foreign Exchange Regulation Act 1947.[1]

Buying listed shares as a non-resident

Under the Bangladesh Bank Guidelines for Foreign Exchange Transactions, non-resident persons and institutions may buy Bangladeshi shares and securities against freely convertible foreign currency remitted through the banking channel. Transactions, including repatriation of dividends and sale proceeds, run through a Non-resident Investor's Taka Account (NITA).[10] Prior Bangladesh Bank permission is not required to issue shares to non-residents against foreign investment, subject to the stated conditions.

Repatriation on exit

For shares of companies listed on an exchange, prior Bangladesh Bank approval is not needed to remit sale proceeds, but the repatriable amount must not exceed the market price on the date of sale.[10] Unlisted shares follow a separate regime: FEID Circular No. 01 of 8 March 2026 consolidates the transfer, valuation and repatriation rules for non-resident holdings in companies not listed on an exchange.[11] If the target group includes unlisted subsidiaries, or the acquirer plans to delist, both regimes matter. See our guides to foreign exchange regulations and capital repatriation.

Investment authority and sector caps

Since 23 August 2026, Invest Bangladesh has been the apex investment promotion agency, combining BIDA, BEZA and the PPP Authority under the Invest Bangladesh Act 2026.[14] Sector rules can override the takeover regime. For banks, section 14A of the Bank Company Act 1991, as substituted in 2023, prohibits any person, institution, company or family member from buying more than 10 per cent of a bank's shares, directly or indirectly, alone or jointly, and allows the bank to require an affidavit that the buyer is not a nominee or benami purchaser.[12]

Competition clearance

Section 21 of the Competition Act 2012 prohibits combinations that adversely affect, or are likely to adversely affect, competition, and allows the Competition Commission to approve combinations that do not. Which combinations require approval is left to regulations.[13] Large listed acquisitions in concentrated markets should be assessed for competition risk early, and the transaction documents should allocate that risk expressly.

Who regulates a listed acquisition

A substantial acquisition of shares Bangladesh deal can touch half a dozen authorities. The organisations below are the ones most often involved.

Penalties for breaching the substantial acquisition of shares Bangladesh rules

Rule 17 provides that a breach of any rule, sub-rule or direction under the 2018 Rules is investigated in the manner the law prescribes and attracts the penalties the law provides.[1] Rule 18 treats compliance with the Rules as compliance with directions and orders under the 1993 Act, and allows the Commission to issue further orders or directions under the Rules.

Administrative penalties

The Securities and Exchange Ordinance 1969 supplies the main penalty tools. Under section 22, where a person wilfully refuses or fails to furnish required information, fails to comply with a Commission order or direction, or contravenes the Ordinance, the Commission may, after a hearing, impose a penalty of not less than Tk 1 lakh, plus a further Tk 10,000 for each day the default continues. The penalty is recoverable as an arrear of land revenue, and no prosecution may follow on the same facts.[3]

Criminal liability for market abuse

Undisclosed stakebuilding often overlaps with fraud and manipulation. Section 17 of the Ordinance prohibits fraudulent acts in securities dealings, and section 24 makes a contravention punishable with imprisonment of up to five years, a fine of not less than Tk 5 lakh, or both. Where the offender is a company, its directors and officers are deemed guilty unless they show the offence was committed without their knowledge or that they exercised due diligence.[3]

Practical consequences

Beyond fines, an acquirer that trades before publication risks having transfers questioned, approvals delayed and conditions imposed on later deals. For listed boards, enforcement is usually triggered by exchange surveillance of unusual volume before a declaration, so a disciplined information-barrier policy during negotiations is as important as the filing itself.

Mistakes to avoid in a listed acquisition

• Assuming a mandatory offer applies. Pricing and structuring on the basis of a 25 per cent trigger that does not exist leads to overpaying or to needless offers.
• Trading before publication. No trade may be executed until the exchange has published the declaration as online news.[1]
• Missing the next-day deadline. In negotiated and non-cash deals, the declaration must be notified the day after the agreement is signed.
• Ignoring concert parties. Family, group and nominee holdings that act together should be aggregated.
• Lodging a rule 6 deposit too early. The 20 per cent deposit is forfeited if the deal does not complete.
• Overlooking sponsor and sector rules. The 2 per cent and 30 per cent conditions, bank caps and foreign exchange routing can each block completion.
• Forgetting post-completion filings. The Schedule 3 certificate is due within one week, and section 12 returns continue after completion.

Before you sign any substantial acquisition of shares Bangladesh transaction, a corporate transaction due diligence review of the target's regulatory history, sponsor holdings and pending BSEC matters is usually the cheapest protection available.

What to watch for the rest of 2026

Three developments deserve attention. First, the draft Corporate Restructuring Rules 2026 would, if finalised, tighten valuation, disclosure and minority approval for schemes involving listed companies, while confirming the 2018 Rules as the takeover code.[9] Second, BSEC continues to approve sponsor block transfers on detailed conditions, as the Dominage Steel decision shows, and those conditions function as deal terms.[6] Third, the consolidation of investment promotion into Invest Bangladesh changes the counterparty for foreign investors' registration and facilitation.[14]

The substantial acquisition of shares Bangladesh regime rewards preparation more than boldness: a clean declaration, a realistic approvals map and sponsor-level terms agreed early. TRW's capital markets practice advises acquirers, sponsors and listed boards on BSEC filings, negotiated deals and regulatory approvals. For an initial discussion, contact TRW. If the target is preparing to list rather than being acquired, see our guide to the IPO process in Bangladesh.

Frequently asked questions

What is a substantial acquisition of shares in Bangladesh?

Under the 2018 Rules, an acquisition is substantial if it takes a person's holding of a listed company's voting shares, or convertible securities, to 10 per cent or more, or any other figure BSEC fixes. Further acquisitions by a person already at 10 per cent or more are also caught.[1]

Is there a mandatory open offer at 25 per cent in Bangladesh?

No. The 2018 Rules impose no mandatory general offer at 25 per cent or any other level, and no minimum offer price. The repealed 2002 Rules had required a public offer to other shareholders with a pricing floor.[1] [2]

When must the declaration be filed in a negotiated deal?

For acquisitions under rules 5 and 6, the Schedule 1 declaration must be notified to the exchange and BSEC within the day following signature of the agreement or memorandum of understanding, and no trade may be executed until the exchange publishes it.[1]

Do the 2018 Rules apply to private or unlisted companies?

No. They apply only to voting shares, and securities convertible into voting shares, that are listed on an exchange. Unlisted acquisitions are governed by the Companies Act 1994, the articles and foreign exchange rules.[1]

Can an acquirer pay with its own shares?

Yes. Consideration may be cash, shares, a combination, or any form acceptable to the seller. A non-cash deal outside the trading system requires a 20 per cent deposit of the total consideration with the exchange and disclosure of the valuation method and valuer.[1]

Can a declared acquisition offer be withdrawn?

Only in limited cases, such as events beyond the offeror's control, the offeror's death or insolvency, a winding-up notice, a change of control of a corporate offeror, the absence of any seller on the exchange, or another reason the Commission accepts.[1]

What are the penalties for breaching the takeover rules?

Breaches are investigated and penalised under the securities laws. Section 22 of the Securities and Exchange Ordinance 1969 allows a penalty of at least Tk 1 lakh plus Tk 10,000 a day for continuing default; fraud under section 17 can carry up to five years' imprisonment.[3]

Does a foreign buyer need Bangladesh Bank approval to buy listed shares?

Generally not. Non-residents may invest in listed securities with foreign currency remitted through banking channels, using a NITA account, and may repatriate sale proceeds up to the market price on the date of sale without prior approval.[10]

Can a buyer acquire more than 10 per cent of a Bangladeshi bank?

Section 14A of the Bank Company Act 1991 prohibits any person, institution, company or family member from buying more than 10 per cent of a bank's shares, directly or indirectly, alone or jointly. The Government is exempt.[12]

How can a buyer acquire the remaining minority shares?

Section 230 of the Companies Act 1994 lets a transferee acquire dissenting holders' shares after a scheme or contract is approved by holders of three-fourths in value within 120 days. For listed companies, practice guides report a 90 per cent buy-out route under the listing regulations.[4] [8]