Safko Spinning owners to transfer shares amid financial struggles
The share transfer process is currently underway, with steps being taken to facilitate potential ownership changes.
The board of directors of Safko Spinning Mills has decided to sell the loss-making company, citing operational challenges, and plans to transfer its shareholdings to interested investors.
The move aims to ensure business continuity and protect the interests of existing shareholders, the company said in a disclosure to the Dhaka and Chittagong stock exchanges today (11 March).
The share transfer process is currently underway, with steps being taken to facilitate potential ownership changes. The initiative is expected to attract new investors who may acquire the stakes currently held by sponsor-directors, including SAKM Salim, SABM Humayun, Syed Saqeb Ahmed, SFAM Shahjahan, and Syeda Momena Begum.
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Following the announcement, Safko's share price rose 9.35% to Tk15.20 on the Dhaka Stock Exchange today.
A team from the DSE had visited the company's factory on 3 February 2025 and found operations closed; production resumed on 31 August last year. The company's auditor issued a qualified opinion, noting significant financial stress.
Safko has accumulated losses of Tk97.81 crore and unpaid bank loans of Tk142.24 crore. Inventory has been sold at nominal prices, and operations were temporarily halted, raising doubts about the company's ability to continue as a going concern.
In the July-December period of the current fiscal year, the company generated revenue of Tk57 lakh after resuming production, with a net loss after tax of Tk6.19 crore, compared with a loss of Tk15.89 crore in the same period last year. Loss per share improved to Tk2.07 from Tk5.30.
Market analysts noted that ownership restructuring is common among listed companies when sponsors seek strategic investors, address financial challenges, or restructure operations. Depending on incoming investors, such transfers may lead to changes in management or business strategy.
Safko confirmed that all regulatory procedures will comply with the Bangladesh Securities and Exchange Commission and stock exchange listing rules. Shareholders will receive updates as the process progresses and approvals are secured.
