BSEC to act against United Airways former board of directors
The Bangladesh Securities and Exchange Commission (BSEC) is going to take action against the former board of directors of United Airways (BD) Ltd, which ceased operations in September 2014.
The decision was made based on an enquiry report at a meeting on Thursday, according to a BSEC press release.
Last September, the stock market regulator formed a five-member enquiry committee to investigate the company's affairs. A BSEC official who wished to remain anonymous said most of the irregularities occurred during the tenure of managing director Tasbirul Alam Chowdhury.
The enquiry team examined various issues, including the suspension and resumption of operations, the reconstruction of the board of directors, the trading pattern of securities, and the overall status of the company.
In March last year, the commission instructed the company to regularise its annual general meetings and complete audits that had been pending for the past four fiscal years.
In June 2021, the BSEC delisted the company from the main board of stock exchanges and transferred it to the over-the-counter (OTC) market due to its weak fundamentals.
To revive operations, the market regulator restructured the company's board of directors in February 2021. It nominated seven independent directors, including Kazi Wahidul Alam, an aviation expert and editor of Bangladesh Monitor, as chairman, and removed former managing director Tasbirul Alam Chowdhury from the board.
Sources said that the company currently has liabilities of around Tk800 crore, of which Tk355 crore is owed to the Civil Aviation Authority, and the remaining debt is to banks and other sources.
Established in 2005, United Airways raised Tk100 crore through an initial public offering (IPO) in 2010. It also issued rights shares in 2011.
When the company did not have the funds to cover the cost of operating flights, officials announced an indefinite suspension of all domestic and international flights.
Later, the company resumed its domestic Dhaka-Saidpur flights. However, in March 2016, all domestic and international flights of the company were suspended indefinitely.
The company's paid-up capital is currently Tk828 crore. Sponsors and directors jointly hold only 2.5% of shares, while general investors own 86.43%.