TDS Desk

The government has taken a decision to sell the ownership of 16 loss-making garment companies of the Beximco Group, in addition to shutting down some other companies. Only profitable ones, including the Beximco Pharmaceuticals, will remain operational.

This decision was made in a meeting of an 11-member advisory committee formed by the interim government.

According to official data, there are 169 companies in total under the Beximco Group, where some 32 are garment sector companies. The government decided to sell 16 of the garment sector companies, and shut down the other loss-making companies after compensating staff with three months’ salary.

The government formed an 11-member advisory council committee on the labour and business situation of Beximco Industrial Park on 24 November, while the committee took the decisions in its first meeting on 28 November. The committee was headed by labor and employment adviser, Brig Gen (retd) M Sakhawat Hossain.

According to the meeting minutes, the committee discussed classifying Beximco Group’s 169 companies into three categories – category A with profitable companies, such as Beximco Pharmaceuticals, category B with moderately performing 32 companies, and category C with the others.

Ashik Chowdhury, the executive chairman of the Bangladesh Investment Development Authority (BIDA), made the proposal for the classification. He, however, refused to comment when asked about the issues.

The meeting took four key decisions over the Beximco Group on 28 November.

Firstly, the Janata Bank will finance the payment of salaries and allowances to workers in Beximco Group companies for the next three months.

Secondly, the Janata Bank will finalise an expression of interest (EOI) for selling the rights of the B-Class companies and inform the labour and employment ministry by 9 December.

Thirdly, an experienced lawyer will be appointed to handle ongoing writs in the High Court, and to finalise the terms of reference for the administrator. The finance division will bear the legal expenses.

Fourthly, the authorities will take over the share transfer process of the Beximco companies within a week, overseen by BSEC and the appointed administrator.

In this regard, Osman Kaiser Chowdhury, director for finance and corporate affairs of Beximco Group, told that the ministry called them before the meeting, but did not allow them in the meeting. “Since we have not received any letter over the decisions, we cannot make any comment in this regard.”

He also expressed various concerns when he was informed about the decisions. He said, “We have no idea how the list was prepared, and it is not clear either what the government is planning to do.”

The Beximco Group director further said the number of companies under their group is not 169, while the decision on selling rights does not seem realistic to them. “We will perform better if arrangements are made to open letters of credit (LCs) to operate the companies.”

According to the meeting minutes, finance adviser Salehuddin Ahmed told the meeting that while concerned authorities are responsible for ensuring overall work environment, in addition to workers’ wages, the workers are frequently blocking roads and creating adversities due to nonpayment of their due wages and arrears. It is affecting the garment industry and other sectors.

Asked about the decisions, labour secretary AHM Shafiquzzaman declined to comment on the specifics of the decisions but expressed optimism about finding buyers for B-class companies.

“An initiative has been taken and let us to try if we can execute it. Firstly, foreign buyers will be invited to run the garment sector factories, while the BSEC will make arrangements to run some companies by appointing independent directors,” he added.

Janata Bank, as the largest investor for the Beximco Group, is now facing challenges due to the group’s inability to repay loans.

Regarding the latest decisions, the bank’s managing director, Mojibur Rahman, said a total of Tk 1.8 billion is required to pay salaries and allowances of the Beximco Group workers. “We will inform the government by 9 December, as per decisions of the board of directors. Besides, we will provide necessary information regarding the B-class companies to the BIDA.”