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Friday, March 20, 2009

Five-star hotels may offload shares

The government plans to offload shares of Pan Pacific Sonargaon and Dhaka Sheraton hotels on the stock market to incorporate common people in these two five-star hotels, Civil Aviation and Tourism Minister GM Quader said yesterday.

“The legal aspects are being examined. If the existing law does not allow listing of Sonargaon and Sheraton hotels on the stock exchanges, we will initiate a move to bring amendments to the law,” Quader said in his address to the opening function of a three-day fair on share market.

Dhaka Sheraton is organising the exhibition titled “Share Bazar Mela” on its premises.

Hotels International Limited, a public limited company, fully owned by the government, is the owning company of Sonargaon Hotel.

The five-star hotel had been built under a loan sanctioned from Overseas Economic Cooperation Fund, now Japan Bank of International Cooperation of the Japanese government and the government of Bangladesh.

Sheraton, 99.68 percent owned by Bangladesh Services Limited, a public limited company of the government, is another five-star hotel in a prime location of the city. The Board of Directors consists of 11 members who are nominated by the government. The civil aviation & tourism secretary is the chairman of the board.

“The hotels have no credit crunch. Bank loans have been taken for the hotels' expansion and modernisation, and the loans are being repaid timely," said GM Quader.

“We are also interested to list other hotels and motels, which are under the tourism ministry.”

Quader said a huge fund is needed for national flag carrier Biman Bangladesh Airlines' restructure and expansion.

“We want to raise the fund from stock market instead of borrowing from banking sector. Capital raised from stock market is more cost-effective than that from banks,” he said.

He said the ordinance, under which Biman was made a public limited company, is waiting to be a law and after enactment of the law, there will be no barrier to offloading Biman shares.

The minister however said Biman's share offloading process might be delayed because of some pre-conditions set by the Securities and Exchange Commission (SEC).

As per the conditions, an issuer company will have to make steady profits for a few consecutive years for being listed. “But Biman made profit only last year. If the SEC offers flexibility, the share offloading process will be accelerated,” the minister added.

Acting SEC Chairman Mansur Alam, Dhaka Stock Exchange President Rakibur Rahman, Chittagong Stock Exchange Vice President Al Maruf Khan and Dhaka Sheraton General Manager Trevor McDonald also spoke at the function.

The Daily Star



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