Envoy Textiles to raise Tk 168cr

Envoy Textiles Limited plans to issue zero coupon bonds to raise about Tk 168 crore for financing its captive power plant project and pre-pay a portion of the high-cost loan.

A zero-coupon bond, also known as an accrual bond, is a debt security that does not pay interest but instead trades at a deep discount, rendering a profit at maturity, when the bond is redeemed for its full face-value.

The listed company announced the issuance of the bonds through private placement in a posting on the Dhaka Stock Exchange website yesterday.

The board of directors of the textile maker decided to issue the 5-year series zero coupon bonds with a face value of Tk 200 crore but at a discounted value of Tk 168.4 crore.

The issuance of the bonds is subject to approval of the Bangladesh Securities and Exchange Commission.

Envoy Textiles has also decided to buy a commercial space to use as extended corporate office at a cost of around Tk 8 crore.

Stocks of Envoy Textiles rose 3.76 per cent to Tk 49.70 at the DSE yesterday.