Provati Insurance Company has successfully acquired a 52% stake in brokerage firm HAC Securities, marking a strategic move to expand its presence in the brokerage business. The deal, priced at Tk4.65 crore, is viewed as advantageous for the acquiring company.
The share purchase agreement, finalized in March of this year, culminated in the official transfer of the stake to Provati Insurance on December 10. HAC Securities, once the 74th member of the Dhaka Stock Exchange (DSE), faced challenges following the stock market downturn in 2010-11, which significantly impacted its clientele and assets.
Presently, approximately 19,000 investors are utilizing the services of HAC Securities, a notable decrease from its pre-2010 client base. Brokerage firms, previously sought after for takeover in the late 2000s, experienced a paradigm shift in valuation dynamics after the market crash. The DSE, which once witnessed a daily turnover exceeding Tk2,000 crore in 2010, now struggles to surpass Tk1,000 crore per day.
The financial performance of brokerage firms, reliant on trade order execution commissions, is influenced by factors such as portfolio investment performance and the recovery of margin loans. Provati Insurance’s acquisition of a majority stake in HAC Securities exemplifies a strategic effort to navigate the evolving landscape of the financial market.
