Home ›› 18 Feb 2022 ›› Stock
The High Court (HC) has turned down the RN Spinning Mills’ proposal to merge with its sister concern saying its reduction of paid-up capital and merger cannot go simultaneously.
Last month, the company announced that its board approved the draft of the scheme of merger or amalgamation subject to the approval of the High Court Division and other authorities concerned.
It proposed to merge with Samin Food & Beverage Industries, a subsidiary of FAR Group that also owns RN Spinning Mills.
“Both the capital reduction process and merger or amalgamation process can’t take place simultaneously, thus the capital reduction process has been declined by the HC,” said the company in a filing with the Dhaka Stock Exchange on Thursday.
On the DSE on Thursday, the company’s share price shed 1.5 per cent to Tk 6.5—much lower than its offer value of Tk 10.
The board of directors earlier decided to relocate the facility to the premises of Samin Mills which is settled in Gazipur.
The loss-making company has a capacity of producing 79,848 spindles of cotton, viscose, and CVC yarn annually.
In 2010, RN Spinning got Tk 30 crore IPO approval from the Bangladesh Securities and Exchange Commission (BSEC) in 2010.
In the 2018-19 fiscal, it faced a loss of Tk 607.11 crore loss caused by a fire incident. In the last fiscal, its cumulative loss stood at Tk 446.68 crore.
RN Spinning’s earning per share (EPS) was Tk 0.03 for October-December, 2021, down 50 per cent as against Tk 0.06 for October-December, 2020.
