Akij Jute Mills is all set to become the seventh Bangladeshi company to invest abroad after the government yesterday gave it the green light to remit $20 million to buy a Malaysian company along with its subsidiary for $80 million.
The approval came at a meeting of the cabinet committee on economic affairs chaired by Finance Minister AMA Muhith, capping off a year-long suspense for Akij Jute Mills, a concern of Akij Group.
“This is a milestone for Bangladeshi enterprises,” Sheikh Bashir Uddin, managing director of Akij Group, told The Daily Star over telephone.
Akij will acquire Robin Resources and its subsidiary Robina Flooring -- both of which manufacture reconstituted wood products and export to about 60 countries, generating $8-9 million in profit a year, according to the investment proposal.
It will remit the $20 million from its export retention quota (ERQ). As of June 22, the company has more than $25 million of foreign currency under its ERQ.
The remaining $60 million that is needed to acquire the two companies will be borrowed from banks overseas.
Akij -- along with two other local business giants Nitol-Niloy Group and Ha-Meem Group -- had applied to the Bangladesh Bank last year for the fund transfer to Malaysia.
Nitol-Niloy Group and Ha-Meem Group wanted to invest $7 million and $10.44 million in Gambia and Haiti respectively.
In May this year, Finance Minister AMA Muhith asked the central bank and the Bank and Financial Institution Division to get a detailed investment plan from the companies before giving them the go-ahead.
But Nitol-Niloy Group and Ha-Meem Group have failed to submit their investment plans.