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Launched by Rahimafrooz Group in 2001, Agora’s 72 p.c shares had been transferred to the Bangladesh chapter of Swedish agency Brummer and Companions in 2009.
Two years in the past, talks had been held on a potential sale of Agora to Gemcon, which runs Meena Bazar, one other superstore chain, however the matter didn’t advance.
Khalid Quadir, CEO of personal fairness fund Brummer and Companions Bangladesh and a director at Agora, confirmed that Agora will probably be offered to Softlogic. The possession switch will probably be achieved in three to 5 months.
Softlogic drives the retail sector of the Softlogic Group encompassing synergies from its multi-brand and multi-channel technique, centered on enhancing the retail panorama in Sri Lanka.
Agora Ltd, headquartered in Dhaka, is a retail superstore that operates a sequence of hypermarkets, low cost malls, and grocery shops.
Softlogic employs over 11,000 folks in Sri Lanka and Australia and operates an asset base of over $750 million to generate an annual turnover of greater than $420 million.
Agora has round 1,200 staff in its 15 shops in Dhaka, two in Sylhet and one in Chattogram. In accordance with the homeowners, it had Tk 5 billion in annual turnover previously few
years.
Muallem Choudhury, principal advisor to Brummer and Companions Bangladesh and one other director at Agora, mentioned Agora is the second main superstore chain in Bangladesh.
WHY THE SALE?
Muallem mentioned they’re promoting Agora as a part of a standard enterprise process.
The switch of possession is going down as a result of majority shareholders need it, he mentioned.
“The Agora traders are personal traders. They’ve a mandate on the sale. The funding should be returned after a sure interval consistent with the contract in order that they will withdraw the funds and make investments these somewhere else. That is what occurring right here,” mentioned Muallem.
“It’s very similar to the share market the place you make investments and earn cash. And promote the shares to purchase different shares should you assume it is necessary.”
The Agora director believes Bangladesh’s market will not be but prepared for superstores, however there are potentialities for chain outlets within the retail market.
“Superstores have captured solely 2 p.c of the retail market whereas the remaining remains to be a standard market. It may be taken as a chance to increase superstore enterprise as nicely. From this, it’s also possible to assume {that a} marketplace for superstores in Bangladesh is not there simply but. Folks will turn out to be extra conscious of well being and secure meals and the superstores will probably be expanded.”
“A lot of the clients are nonetheless from low- and middle-income teams in Bangladesh. Furthermore, a 5 p.c VAT has been imposed on the acquisition from the superstores. The shoppers needn’t pay this VAT in the event that they purchase items from native grocers. It may be seen as a barrier to doing superstore enterprise,” Muallem mentioned.
He additionally alleged the federal government companies are contemplating the superstores as a smooth goal of their drives towards irregularities. “The identical issues, for which superstores are fined, exist within the conventional outlets. However solely the superstores face motion.”
FOR HOW MUCH?
Softlogic will purchase 100% stakes in Agora. In a submitting to the Colombo Inventory Trade, the corporate mentioned the acquisition could be accomplished in a collection of transactions.
It has not revealed the amount of cash to be transacted.
Khalid declined to make public the valuation of Agora within the cope with Softlogic. He mentioned the Sri Lankan agency will disclose it in time.
“Everybody could know for the way a lot Agora has been offered when the ultimate transactions happen. Perhaps Colombo Inventory Trade will probably be advised one thing about it at the moment.”
WHAT WILL HAPPEN TO THE WORKERS?
Muallem sees no cause for adjustments within the workforce of Agora after the switch of the possession.
“A sure course of should be adopted in the event that they wish to usher in international staff. However international staff gained’t be very crucial in working such retail enterprise.”
“I believe international staff won’t be wanted for a enterprise the place native manpower is sufficiently accessible. Those that are working now will keep. Solely the possession will change arms,” Muallem mentioned.
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