BASIC and Bank Asia reach out to relaunch Emerald Oil


BASIC Bank and Bank Asia have volunteered to revive Emerald Oil Industries – the producer of the nearly forgotten Spondon rice bran oil – by waiving interest on the loan.

The company owes Tk 61 crore to BASIC and Tk 20 crore to Bank Asia in principal. Including interest, the loan amount exceeded Tk 100 crore.

Minori Bangladesh Limited – a subsidiary of the Japanese agricultural company Minori Co Limited – the company interested in taking over Emerald Oil, will handle the loans after they are cleared.

In return, Minori Bangladesh will get a 30% stake in Emerald Oil Industries, owned by the sponsors and directors of the company.

The operations of the organic farming company Minori in Bangladesh are based in Tangail.

Minori had previously bought more than 8% of the company’s shares on the secondary market.

After receiving the stakes, Minori will inject around Tk45 crore as working capital to rejuvenate Emerald Oil – a loss-making entity in the food sector and ally in the capital market.

Emerald Oil production has been halted since 2017 due to a lack of working capital following loan scams from its founders. They later landed in jail and fled the country upon their release.

As part of the transfer of shares held by sponsors and directors, the company is expected to sign an agreement with Minori Bangladesh on Wednesday.

Company officials will later send banks a request for loan rescheduling and the reconstituted board will announce a deadline to resume production.

Previously, the board aimed to restart production in September, but this failed as the license renewal, share transfer and other tasks were not completed due to the Covid pandemic- 19.

An independent director of Emerald Oil, seeking anonymity, said the new board of directors was set to bring the company back into business after completing all necessary tasks.

“This week, an agreement will be signed with the interested company for the takeover of the 30% of the capital,” he added.

BSEC initiatives and interest relief

Keeping investor interest in mind, the Bangladesh Securities and Exchange Commission (BSEC) in March of this year replenished the board of directors by appointing five distinguished professionals to revive the company.

In a joint meeting with BSEC and the reconstituted board of directors, senior officials from both banks recently agreed to waive interest and only receive the principal amount of their loans.

To recover the classified loans, the bank officials have given their approval but the final approval will come from the boards of directors of the lenders.

As bank officials have agreed, the company’s new board is optimistic about regularizing the loans.

Sources said the two banks will now reschedule loans with a 5% down payment for ten years with a two-year grace period.

About the company

Incorporated in 2008, Emerald Oil entered the production of Spondon rice bran oil in 2011 and entered the stock market in 2014.

But, within a few years, it collapsed both in its business and on the stock market as soon as the founders’ credit scams unfolded.

After creating a mood in the Bangladesh market, Spondon recorded 276 crore in revenue from Emerald Oil in the 2015-16 fiscal year.

The company made a profit of Tk 18.07 crore and paid a stock dividend of 10% to its shareholders.

After that, the company did not release its financial statements due to a production shutdown.

The new board sees great revival potential for Spondon and plans to export the oil to Japan while selling the heart-sweet cooking oil in the local market.


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