Alif Industries, a publicly traded garment company, is going to take over non-listed export-oriented denim plant and a dredging company to diversify its business.
The board of Alif Industries authorised its Managing Director Md Azimul Islam to initiate the takeover process of Royal Denim, a 100 percent export-oriented denim producer with a current capacity of 750,000 yards per month.
The factory of Royal Denim is located at the Cumilla Export Processing Zone, said the company in a stock exchange filing on Wednesday.
The Alif Industries' board has directed the managing director to make sure relevant laws are complied with.
Similarly, the board has also authorised the managing director to initiate the takeover process of Diamond Dredging.
"The board has further directed Md Azimul Islam to submit all relevant documents along with the detailed feasibility report, estimated cost of purchase and mode of financing within 30 working days to the board for further decision," reads the disclosure.
The company did not disclose the amounts involving the deals.
Md Azimul Islam, managing director of Alif Industries, could not be reached for comments.
Company secretary Mahfuzur Rahman said the takeover plan was at the initial stage. However, he said, the board took the decision to diversify business.
Alif Industries, formerly known as Sajib Knitwear and Garments, started business in 1992 and listed in the stock market in 1995.
The company found itself in trouble as the management took out a loan from Islami Bank Bangladesh, keeping its sponsor/directors shares mortgaged.
The company incurred huge losses and became unable to repay the loan in time. At one stage, bank liabilities ballooned to TK 150 million.
The company was compelled to close production of garments and the Dhaka bourse delisted it in 2007.
Alif Group took over the company in 2010 and resumed export in 2015. The company changed its name into Alif Industries in 2015 and relisted on the DSE's main board in December 2017.
Following the news, the stock price rose 1.50 per cent to close at Tk 94.5 per share on Wednesday. In the past one month, the stock jumped 25 per cent.
In September last year, Alif Industries also decided to merge with Alif Manufacturing Company, subject to banks' approval of the scheme of amalgamation and other creditors' and shareholders'.
Both are Alif Group concerns and listed on the Dhaka and Chittagong Stock Exchange.
After completion of the merger, Alif Industries will be the surviving entity on the stock exchange.
In 2021, Alif Group acquired C&A Textiles, a listed company in the textile sector.
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