Company officials say Northern’s board wants to remove Nandi from his role as chairman
The High Court has lifted its directive to freeze the bank accounts of jute goods exporter Northern Jute Manufacturing Company Ltd – and set some conditions. The move has convinced the company's top officials that they reopened their factory today.
Northern's Chief Financial Officer Ujjal Kanti Dhar told The Business Standard, "Our board will have a meeting on the High Court ruling where the company's next course of action will be decided."
In the meantime, a company official, preferring to remain anonymous, said the High Court had relieved Uzzal Kumar Nandi from the responsibilities of Northern's chairman. "So, no transaction can be made with the signature of the current chairman. The company will appoint two lawyers, following the court order, instead. With the signatures of these lawyers, the company will be able to do transactions through the seized bank account."
Also, the company officials say its board wants to remove Nandi from his role. A final decision on this will be made at the next board meeting.
The High Court bench of Justice Mohammad Khurshid Alam Sarkar, on January 22 this year, ordered the authorities concerned to freeze the bank accounts and confiscate the passports of 20 persons. This included Nandi, who previously served as the chairman of People's Leasing and Financial Services – a non-bank financial institution now under a liquidation process.
Following the court order, the central bank directed all banks to freeze Northern's accounts with them.
Also, the company, in a disclosure to the Dhaka Stock Exchange (DSE), said it had shut down its mill in the Bangladesh Small and Cottage Industries Corporation area in Kushtia. It, as a result, could not pay a 100 percent cash dividend to its shareholders in the last financial year.
As the ruling of the court was in the company's favour, its share price on the DSE rose by 6.49 percent on Tuesday, while the closing price was Tk397.50.
Previously, the share price of the company had dropped by 27 percent as the news of its factory shutdown spread.
The paid-up capital of the company – which was listed on the stock market in 1994 – is Tk2.14 crore.
The sponsors and directors of the company own 21.87 percent of its shares and general investors hold the remainder.
In the first half of the current financial year, Northern's revenue was Tk39.63 crore and its net profit was Tk2.16 crore.
In the last financial year, the company made a net profit of Tk5 crore.