Emerald Oil returns to production after four years
The newly restructured board of directors are hoping to overcome outstanding losses and reach a break-even point within six months as there is a significant demand for their rice bran edible oil, which is marketed under the brand name Spondon
Emerald Oil Industries Ltd has resumed production of its rice bran edible oil after a hiatus of four years thanks to fresh investment by Minori Bangladesh Limited, a subsidiary of Japanese farming company Minori Co Limited.
The company, which has completed a successful trial run, is expected to go into full-fledged commercial production from January, said its officials.
The newly restructured board of directors are hoping to overcome outstanding losses and reach a break-even point within six months as there is a significant demand for their rice bran edible oil, which is marketed under the brand name Spondon.
The company halted its production in 2017 due to a shortage of working capital following its founders' loan scam, getting arrested, and finally fleeing the country.
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To help Emerald Oil turn around, Minori Bangladesh Limited is investing around Tk45 crore as working capital, other than taking care of the company's finances and liabilities with Basic Bank, and Bank Asia amounting to Tk70 crore in loans that crossed the Tk100 crore mark with interest.
The Japanese subsidiary will also help Emerald Oil's potential exports to Japan alongside serving the local market.
As per the agreement between the two companies, Minori Bangladesh will own 30% shares from the company's directors and sponsors. Besides, Minori has already purchased 10% shares of Emerald Oil from the capital market.
"There is a massive demand for rice bran oil both in the local and the international market. We have already received queries from several foreign companies, including two Japanese companies and signed a trade deal worth Tk10 crore with an Indian company," one of the new board members of the company told The Business Standard.
Earlier, in August, Emerald Oil announced that they will go into full-fledged commercial production from 1st September, which was later postponed as they could not obtain most of the required licences due to the lockdown.
Emerald Oil, incorporated in 2008, began production of its Spondon-branded rice bran oil in 2011 and entered the bourses in 2014. The company raised Tk20 crore issuing 2 crore general shares at a face value of Tk10.
But, in a few years, it melted down both in its business and in the stock market as soon as the founder's loan scams unfolded.
In March this year, the Bangladesh Securities and Exchange reconstructed the failed company's board by appointing five distinguished professionals, while a representative of its Japanese investor Minori's Bangladesh arm also joined the board.
