Shepherd Industries plans to merge with sister concern
The company requires approval from its shareholders, banks
Taiwan-based investor company Shepherd Industries Limited wants to merge with its sister concern Shepherd Textile (BD) Limited.
The board of directors of Shepherd Industries – engaged in the business of dyeing and washing yarn and fabrics – made the decision at a meeting on Monday.
In a statement filed with the Dhaka Stock Exchange (DSE), the company said it now requires approval from its shareholders, banks, and other creditors as well as the High Court's permission, to complete the merger process.
But its independent auditor, which prepared the company accounts for fiscal 2020-21, said in its audit report, "During our visit to the Shepherd Industries' factory premises, we found a sister concern named Shepherd textile is also situated at the same premises and the two companies did not maintain a systemic policy for segregation of individual activities."
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The company has not disclosed the textile mill's business status.
In 2019, the Bangladesh Securities and Exchange Commission (BSEC) had earlier rejected Shepherd Industries' proposal to buy shell company Shepherd Jeans Ltd's 1.5 crore shares for Tk15 crore.
A source at the BSEC said the commission rejected the share purchase proposal after the company had failed to provide ancillary documents such as TIN, trade licence, import registration certificate, export registration certificate, bonded warehouse licence, VAT registration certificate, and environment clearance certificate.
Shepherd Industries listed on the capital market in 2017. Currently, its directors and sponsors hold 51.48%, institutions 23.31%, foreign investors 9.49%, and general investors 15.72% shares in the company.
It paid 2.50% cash and 2.50% stock dividends to its shareholders for fiscal 2020-21 although it incurred losses that year.
At the end of the first nine months of fiscal 2021-22, its sales grew by 51% to Tk258 crore and net profits stood at Tk15.50 crore.
On Tuesday, its shares closed 4.43% lower at Tk25.90 on the DSE.
