Akij to remit $20m to buy Malaysian firms

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.