Canadian company buys Shahriyar Fabric
Gildan wraps up deal for $15m
Refayet Ullah Mirdha
Canadian T-shirt giant Gildan Activewear Inc yesterday wrapped up the acquisition of Shahriyar Fabric Industries Ltd, choosing Bangladesh as a base for manufacturing in Asia.
Gildan, based in Montreal, has bought the Bangladeshi company for $15 million.
The acquirer will also assume the debt of Shahriyar Fabric Industries, an export-oriented apparel maker, said Shahriyar Hossain, managing director of the company.
Hossain said he sold the composite factory as he had a heavy financial burden to bear. The factory in Ashulia produces high-quality ring-spun T-shirts and has a capacity to produce 2.2 million dozen T-shirts a year.
“I cannot exactly say the total amount of the liabilities of the company that was established 13 years ago. All I can say is, the amount is huge,” Hossain said.
Moreover, the issues of gas and power, coupled with some personal problems, forced him to sell the factory, he told The Daily Star by phone. Shahriyar Fabric has 3,000 workers.
In October 2009, the company received an interest waiver worth Tk 8.72 crore for its “transaction reputation” with state-owned Sonali Bank, he claimed.
Hossain said the new owning company will not sack workers, and rather, it will upgrade the factory with modern facilities.
The 42-year-old entrepreneur said business was going well, but for some personal and financial problems, it was difficult to continue.
Gildan plans to increase the facility’s annual production capacity to 3.5 million dozen T-shirts to support the company’s international business growth strategy.
According to a montrealgazette.com report, Gildan CEO Glenn Chamandy told the annual shareholders’ meeting in early February that Gildan planned to build a low-cost high-quality manufacturing base in Asia, but excluded China as a potential location.
According to CNNmoney.com, the acquisition is the result of substantial analysis carried out by Gildan to identify a strategic location to begin the development over time of a potential major vertically-integrated manufacturing hub in Asia with an infrastructure and geographical location to position Gildan as a low-cost, high-quality producer to serve its target markets.