Alif Group – a business conglomerate in the country – will acquire C&A Textiles, which has been out of operation for more than four years.
The Bangladesh Securities and Exchange Commission (BSEC) recently accepted the acquisition proposal "in the greater interest of investors" and issued seven instructions for the group to comply with.
After the acquisition, the group will take initiatives to cover and meet gas and utility bills as well as bank liabilities of the textile manufacturer.
It will also have to take the steps needed to bring C&A Textiles back into production.
C&A Textiles – a 100% export-oriented knit composite company – was in knitting, dyeing, printing, and manufacturing various types of readymade garments for export to Europe, America, Canada, the UK, Italy, and Germany.
Alif Group has a strong presence in the textile, garments, financial services, and real estate sectors.
The group's two companies – Alif Manufacturing Company Ltd, previously known as CMC Kamal Textile Mill Ltd, and Alif Industries – are listed on local stock exchanges.
According to BSEC conditions, Alif Group will have to comply with all securities laws in raising capital, issuing new shares and bonds.
The group will regularise all the pending annual general meetings and audited financials of Alif Industries and Alif Manufacturing.
It will have to retain C&A Textiles' share money deposits or collected money in a bank account separate from the rest of the Alif Group, using that only to meet bank liabilities and start production at C&A Textiles.
C&A Textiles history in the stock market
C&A Textiles raised Tk45 crore from the capital markets with an Initial Public Offering (IPO) in 2015.
According to its prospectus, the company paid Tk30.87 crore towards loan repayments and business expansion.
In June 2017, C&A Textiles announced a sudden shutdown of production for renovation work, and its offices have remained closed since then.
In February 2021, BSEC restructured the underperforming company's board, appointing seven directors.
C&A Textiles was incorporated in 2001 and started commercial operations in 2003.
In March 2021, police arrested C&A Textiles' managing director (MD), Rukshana Morshed, in a case filed for money laundering.
Union Capital had filed the case in 2019 against the company's bosses, including the MD.
In the interest of investors, Dhaka Stock Exchange (DSE) officials visited the company factory in Kalurghat, Chattogram, and the company's headquarters in 2019, but found both premises closed.
On 29 July 2020, BSEC found that C&A Textiles' MD, Rukshana Morshed, Director Sharmin Akther Lovely, and Bangladesh Shoes Industries Limited had together sold around 1.22 crore shares of the company without prior declaration, taking around Tk12 crore from these sales.
As a penalty for violating several rules, the securities regulator later fined them Tk19 crore and banned them from assuming the roles of directors at any other listed company.
Moreover, the textile company could not submit a single directors' monthly shareholding report between August 2017 and August 2018, and also breached rules by failing to respond to queries sent by BSEC and DSE.
Shareholders have also received no updates about the company since 2017.
The last time the company declared a dividend for its shareholders was in 2016.
According to shareholding data released in July 2017, the owners' shares in the company amounted to only 22.14%.