Among the listed companies of the textile sector on the website of the Dhaka Stock Exchange (DSE), one will come across Familytex (BD).
Except for the company's name and some sporadic financial figures uploaded until 2020, no other information and corporate disclosure is available of the company.
The 'Z' category company has not been in operation but it is hard to say for how many years. It also has no website.
Currently, retail investors hold more than 77 per cent of the total shares offloaded by the company for public trading. On the other hand, sponsor-directors have only 4 per cent shares, reduced from 75 per cent in 2013 immediately after the initial public offering.
That means the sponsor-directors have gradually jettisoned their holdings with a bad intention that becomes even more obvious when one looks at the pattern of dividend distribution by the company.
Familytex distributed only stock dividends since its listing to its shareholders.
Issuing stock dividends, the sponsors increased their holdings and then sold shares to general investors.
The company issued 100 per cent stock dividend just after being listed in the stock exchanges in 2013.
Later, it issued 10 per cent stock dividend in 2014, and 5 per cent in 2016, 2017 and 2018 each.
BSEC officials previously said the company's sponsors had sold shares without any corporate declaration in breach of the regulatory obligations.
The stock has remained stuck at Tk 4.90 (the floor price), less than half the face value of Tk 10.
Meanwhile, more than two years have gone by since the restructuring of the board, but the action has borne no fruit.
Why the restructured board failed
To restore the operation of the company, the Bangladesh Securities and Exchange Commission (BSEC) in March 2021 appointed seven independent directors including a professor and an associate professor of the University of Dhaka.
But the new board failed to work as the company's sponsors did not cooperate with them.
Chairman of the reconstituted board Dr. Md. Foroz Ali, a former director of Agrani Bank, said the new board had not found any data and a minimum official structure to do the job they were entrusted with.
The directors wanted to visit the company situated at an export promotion zone in Chittagong. But the visit was not possible due to non-cooperation of the sponsors, said Mr Ali.
That is the reason why all independent directors resigned from the board.
"We found no intention of the sponsors to help revive the company," he said.
Why the apathy of sponsors
The company's IPO was approved by the previous commission in 2013.
As per the regulatory requirements, the sponsor-directors of a listed company must hold at least 30 per cent of the shares publicly traded. The provision was introduced to make sponsor-directors responsible.
It is not surprising if the sponsors of Familytex show a lack of interest in the revival of the company with their stakes shrunk to only 4 per cent.
Another independent director of the restructured board said the previous chairman of the company had extended no support to help them restore operation.
The independent directors resigned submitting a report to the securities regulator. In the report, they mentioned the obstacles they faced.
But the regulator did not suggest anything for the next course of action.
Mohammad Rezaul Karim, a BSEC executive director, said the board of Familytex might be restructured again.
"The regulator will take measures in line with the rules to secure interest of general investors," he said.
No official of Familtex could be reached for comments on the complaints of independent directors and the present state of the company.
Before going public, the company showed huge profits, but after 2014 its yearly profit started to plummet.
Later, the company reported a loss of Tk 0.08-Tk 0.15 per share annually for the years between 2017 and 2020.
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