Akij Group now wants remit US$ 32 million (Tk 2500 crore) to Malaysia through indemnity from foreign exchange rules to pay as price of two Malaysian companies it acquired earlier.
The group acquired Robin Resources Malaysia SDN BHD and its subsidiary Robina Flooring SDN BHD at a cost of $77 million in 2017.
In November 2018, Japan Tobacco Inc, completed its $1.47 billion acquisition of Akij Group’s tobacco business. The money is now deposited at Bangladesh Bank as foreign exchange reserve. The company wants to remit a part of money from it a company loan.
“Managing Director of Akij Group SK Bashir Uddin has recently sent a letter to the Foreign Exchange Department of Bangladesh Bank to seek permission for using the funds received from Japan Tobacco Inc. (JT) as company loan for the Malaysia Akij Resources SDN BHD.” A high official at the central bank told Business Mirror.
The central bank denied their request saying that it is a complete breach for Bangladesh Foreign Exchange rules.
MohamandAminrul Islam, JD of BB, in a letter in this regard said there is no opportunity to provide loan to private company from the country’s forex reserve.
However, The Economic Affairs Adviser to the Prime Minister Sheikh Hasina, Mashiur Rahman, negotiates in favour of Akij Group to remit $32 million to Malaysia as loan.
The adviser also sent a letter to the finance minister AHM Mostafa Kamal to exempt from Bangladesh Foreign Investment Policy for Akij Group to remit fund to Malaysian.
Mashiur Rahman’s letter mentioned that idle foreign exchange reserve brings no benefit for Bangladesh economy.
According to the letter of Akij MD, Akij Group has deposited $195 million in Standard Chartered Bank that is now included in the forex reserve. Now, Akij group wants to remit $ 32 million to Malaysia from this deposited amount.
Two years ago, Akij Group completed acquisition of two Malaysian companies with $77 million, including $20 million taken from Bangladesh, but profit repatriation from the Southeast Asian country to Bangladesh is unlikely to start in few years.
It is letter Akij mentioned that the acquisition of two Malaysian companies — Robin Resources Malaysia SDN BHD and its subsidiary Robina Flooring SDN BHD — as a matter of ‘pride’ for Akij Group as well as for the country.
The companies manufacture medium-density fiberboard, wooden floor tiles and different wooden products, and export around 60 countries.
Akij Group, one of the leading conglomerates of the country that has operations in sectors as diverse as matches to cigarettes, beverage to cement and particle board to ceramic.