The Business Standard 1 September 2020
Publicly listed Singer Bangladesh Ltd will merge with its non-listed subsidiary company, International Appliances Ltd, in order to curb costs by reducing corporate taxes.
An official of Singer Bangladesh told The Business Standard that the merger will help reduce corporate taxes as non-listed companies must pay a 32.5 percent corporate tax, whereas listed ones only have to pay 25 percent.
Buy elavil
“After the merger, International Appliances will no longer be a non-listed company. We can then operate the subsidiary company with lower costs,” he added.
As per the Company Act, Singer Bangladesh will appeal to the higher court regarding the merger. The company will then hold an extraordinary general meeting, upon receiving directives from the court, to get the approval of the shareholders before merging with its subsidiary.
Singer Bangladesh holds 100 percent shares of International Appliances. The latter’s paid-up capital is Tk38.89 crore.
Singer will appoint a valuer to determine the price of the shares of International Appliances.
International Appliances was incorporated as a private limited company on December 23, 2014. Singer acquired it as a subsidiary on October 16, 2017.
The subsidiary company manufactures and sells refrigerators of different capacities, models and types under the Singer brand name.
Its manufacturing plant is situated in Savar. Currently, its refrigerator production capacity is 1.32 lakh units per year. However, it had over produced its capacity last year.
The revenue of International Appliances increased 19 percent to Tk255.3 crore in the last year as compared to the previous year. However, it posted net losses for the last two years.
Meanwhile, Singer Bangladesh posted a 41 percent drop in sales in the second quarter of this year due to the countrywide 66-day general holidays declared to curb the novel coronavirus outbreak.
The company earned revenue of Tk299.49 crore in the April-June period this year, down from Tk516.76 crore at the same period in the previous year.
Its net profit also dropped by 80 percent to Tk7.89 crore and its earnings per share stood at Tk0.79.
Last year, Singer reached a milestone in home appliance sales with a turnover of Tk1,500 crore. The company had paid a 77 percent cash dividend to its shareholders.
Singer Bangladesh was listed on the Dhaka Stock Exchange (DSE) in 1983. Its paid up capital is Tk99.70 crore.
The company just sold sewing machines till 1985. Later, it included electronics and home appliances in its business.
Singer used to import 90 percent of its products and manufacture 10 percent a decade ago. Now, the company locally manufactures 62 percent, reducing its percentage of exports.
The closing price of each share of the company stood at Tk168.10 on Thursday at the DSE.
Of the company’s total shares: sponsors and directors jointly hold 57 percent, institutional investors have 17.55 percent, foreign investors have 6.34 percent, and general investors own 19.11 percent of shares.
Buy effexor
