Janata Bank moves to auction 6 Beximco factories despite govt's revival plan
The labour ministry has been trying to reopen Beximco’s internationally certified textile factories to preserve thousands of jobs and maintain export earnings
Highlights:
- Auction notices issued a day after the bank's 20 Nov board meeting
- Three more factory notices coming soon
- Board dropped lease plan, opted for auction
- Bank MD opposed leasing, backed auctions
- Factories owe over Tk3,000 crore with interest
- Govt's revival plan with Japan's Revival stalls
- Draft tripartite lease deal abandoned after agenda shift
State-owned Janata Bank has moved to auction six Beximco Limited factories, despite the government's efforts to revive the struggling company through an international lease agreement.
Within a day of the board meeting on 20 November, the bank issued public notices to auction 193 decimals of land and all structures on it at Beximco Industrial Park, which had been mortgaged as collateral for loans on three of the factories.
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Notices for the other three factories are expected to be published soon, according to bank sources.
The 20 November board meeting was initially scheduled for 18 November. The original agenda focused on approving a draft agreement between Beximco, Janata Bank, and Japanese firm Revival, which had expressed interest in leasing the factories. The meeting was postponed, and the agenda was changed to include auctioning Beximco's mortgaged assets to recover outstanding loans.
When contacted for comment, Janata Bank MD and CEO Md Mazibur Rahman did not answer the call. He later replied via WhatsApp but declined to comment, saying he was busy in a meeting and would speak later but he did not receive subsequent calls.
However, a senior labour ministry official told TBS that during various meetings, Janata Bank's MD opposed leasing and favoured auctioning the factories. Reports also suggest that a government adviser and a secretary supported the auction over reopening.
On 21 November, the bank placed advertisements in several newspapers announcing the auction of all outstanding loans, including interest, for International Knitwear & Apparel Limited's Unit-1 and Unit-2, Urban Fashions Limited, and Apollo Apparels Limited. Interested buyers can submit bids until 7 December.
What's in the auction notice
According to Janata Bank's notice, it had extended loans of Tk543.7 crore to International Knitwear & Apparel Limited's Unit-1 and Unit-2, which now total Tk1,754.7 crore with interest. Urban Fashions owes Tk252.45 crore, now Tk724.26 crore with interest, and Apollo Apparels owes Tk251.26 crore, now Tk816.4 crore.
In total, the three factories – including machinery, inventory, 193 decimals of land at Beximco Industrial Park in Kashimpur, Gazipur, and all structures – are being auctioned.
Additionally, immovable assets mortgaged against loans to Crescent Fashions and Design Limited (Tk1,397 crore), Assess Fashion (Tk1,135 crore), and Bangladesh Export Import Company (Tk1,316 crore) will also be auctioned.
Govt efforts to revive
The labour ministry has been trying to reopen Beximco's internationally certified textile factories to preserve thousands of jobs and maintain export earnings. The ministry has held several meetings with the Finance Division, Bangladesh Bank, Janata Bank, and other lenders to facilitate this.
In May, Japanese company Revival Project Limited submitted an Expression of Interest (EOI) to the government to lease the factories. Beximco Limited provided a Letter of Comfort in support. Subsequently, the government initiated plans to reopen the factories.
On 22 July, the labour ministry convened its first meeting with the Finance Division, Bangladesh Bank, and Janata Bank to discuss reopening Beximco's textile units. Several follow-up meetings were held, and the decision to operate the factories under the Companies Act was endorsed.
An 11-member advisory committee, formed in November 2024 to review labour and business conditions in Beximco Industrial Park, supported Revival's proposal.
The committee was chaired by Labour and Employment Adviser Brigadier General (retd) M Sakhawat Hossain. Another five-member advisory panel, formed on 30 June to accelerate business, trade, industrial, port, and revenue collection activities, also endorsed reopening the factories.
Bangladesh Bank reportedly held several meetings on the matter, indicating that Beximco could lease the factories. Accordingly, Revival is preparing to lease the units and plans an initial working capital investment of $20 million, with a long-term goal of up to $100 million.
US-based Ecomillie is expected to finance the project. Beximco has repeatedly stated that its foreign buyers are awaiting the restart of production.
The draft agreement specified that Revival would operate Beximco's factories and take a 1.5%-2.5% commission from export earnings. The remaining income, after operational costs, would repay Janata Bank and other lenders. Beximco would receive no funds directly.
On 8 October, Revival, Beximco, and Janata Bank drafted a contract, scheduled for board approval on 18 November. The board meeting was postponed to 20 November, and the agenda was altered to include auctioning the factories and mortgaged assets.
