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Mithun Knitting and Dyeing Limited is listed in the capital market in the apparel sector. As it has been closed for the past three years, it had arrears of around Tk 10 crore including lease rent, gas, water and electricity bills to Bangladesh Export Processing Zones Authority (BEPZA), and workers' salaries.
To collect this debt, BEPZA authorities recently sold the company's entire factory along with its machinery at an auction, making the company non-existent. Thus, 82 per cent of shares of the company, held by general and institutional investors and valued at Tk 27 crore, have now become worthless.
According to sources from BEPZA, Mithun Knitting and Dyeing Limited, which is located in sector four of Chattogram Export Processing Zone (CEPZ), closed three years ago due to management failure. Since then, the owners also went into hiding.
As a result, factory production of the company came to a halt. To collect the debt the company owes, BEPZA auctioned off the entire factory of the company along with its machinery to a foreign company, the sources said.
On the other hand, sources from Mithun Knitting and Dyeing Limited said, the company was blacklisted because it could not carry out the renovation work as per the instructions of the foreign buyers’ organisation Accord. As a result, foreign buyers stopped placing orders.
Due to continuous losses, Mithun Knitting and Dyeing closed its garment factory but kept the textile division running. In September 2019, BEPZA stopped providing all services to the company as debt began to pile up, the sources said.
As a result, the owners were forced to close the factory and filed a notice to the Dhaka Stock Exchange and Chittagong Stock Exchange on September 20 of the same year announcing the stoppage of production. Despite several meetings with BEPZA, the company could not find any solution, the sources also said.
According to the latest annual report of Mithun Knitting and Dyeing Limited, its factory was set up in CEPZ in 1991 and came into commercial production in 1993. In the following year, the company was listed in two capital markets of the country.
According to the report, the daily production capacity of the company was 5.7 tonnes of fabrics and five thousand pieces of garment products. There were 764 employees and officers employed in the company which exported all products abroad.
However, due to the old machinery, the company failed to fulfil production expectations. As there was also a shortage of money, the number of workers started to decrease and production capacity started to fall.
In the fiscal year 2017-18, the total sales of the company were around Tk 44 crore. However, the net loss was Tk 7.27 crore. In the fiscal year before that, it had a loss of around Tk 6 crore. The company's production has stopped in recent years, so the latest figures could not be found.
To know the latest situation, Mithun Knitting and Dyeing Limited Company Secretary Mohamad Shohel was contacted several times over the phone but he did not respond.
CEPZ Executive Director Moshiuddin Bin Mesbah said, “Currently there is no company named Mithun Knitting and Dyeing in CEPZ of Bangladesh Export Processing Zone Authority. Recently, Mithun Knitting and Dyeing was auctioned to collect outstanding dues worth a few crores of Taka.
“A foreign company bought the company at the auction. Basically, the ownership of the industrial plot has changed. As the structures are old, it has no market value.”
“The owners of the company filed a writ against the auction in the High Court. Later, as the verdict came in our favour, we auctioned the company off to foreign investors. Besides collecting the dues the company owed to BEPZA, the dues to its workers had also been paid,” he said.
