Bangladesh Securities and Exchange Commission yesterday halted the investment deal worth of Tk 50 crore by LR Global Asset Management on bdnews24.com as the regulator was concerned about the interest of regular investors’ investment.
The deal has been halted till the capital market regulator completes assessment of the relevant documents. The regulatory body made the decision at an emergency commission meeting presided over by its chairman M Khairul Hossain.
The BSEC said that it was drawn attention to a media report that Tk 50 crore would be invested in bdnews24.com by LR Global or from funds managed by the asset manager. Hence, the commission ordered the asset management company to provide details of the investment deal in 24 hours.
BSEC also asked all parties concerned with the matter to refrain from activities of the investment before the regulator receives all documents and assesses them.
LR Global, led by Chief Executive Officer Reaz Islam, closed the investment deal with bdnews24.com in Dhaka last week
Bdnews24 in a report published in its online portal said that LR Global Bangladesh invested Tk 50 crore in bdnews24.com. According to the report, the investment amount would be used for “the expansion of news automation and creativity” of the news portal.
bdnews24.com Editor Toufique Imrose Khalidi said that now bdnews24.com was accountable not only to its readers but also to 30,000 investors through LR Global.
LR Global is an asset management company, an affiliate of LR Managers Investments in New York, started operating in the country in 2008. The company launched its first mutual fund in 2010 and currently managing six mutual funds amounting around $172 million.
In 2015, LR Global Bangladesh was fined Tk 50 lakh for its investment in four non-listed private companies: Guardian Healthcare, Thyrocare Bangladesh, Property Investors and Tribeca Management.
As per the existing rules, the funds collected under the mutual fund can be invested only in listed securities, initial public offerings (IPOs) and transferable securities in the money market.
The mutual fund can invest 70% of its investment in listed companies and the rest 30% in non-listed but financial or money market companies. The mutual funds can also invest in the pre-IPO placement shares after taking regulatory consent.