MNCs’ investment withdrawal ‘threats’ delay share offloading [ Tritiyo Matra News ]

MNCs’ investment withdrawal ‘threats’ delay share offloading

Local January 24, 2016

A decade-old decision of offloading the government’s shares in the multinational giants on the stock market could not be implemented because of threats of withdrawing investment from the country by the companies, officials said.
The major multinational companies are Unilever and Aventis in which the government owns 39.1 per cent and 45.36 per cent shares respectively.
The government was looking to bring quality securities into the country’s stock market to meet the longstanding demand from the small investors.
But the initiative was opposed mainly by the multinational companies which threatened to withdraw investment from the country, they said.
Bank and Financial Instantiations Division secretary M Aslam Alam told New Age that the threat was given in recent time after the division reminded Unilever and Aventis to honour the government decision.
According to the decision made in 2005, the government selected 26 companies in which it has stake.
Unilever and Aventis were among the companies.
The government wanted to sell its five per cent shares to public and also wanted that both the companies would offload another five per cent shares in the country’s two stock markets.
Aslam said the government had to hold beck its decision due to such threat by the companies.
Formerly known as Lever Brothers Limited, the Anglo-Dutch fast-moving consumer goods giant has been operating in the country since 1964. It changed its name to Unilever Bangladesh Limited in 2004.
Economist Abu Ahmed said Unilever’s shares were already being traded in Pakistan and India and at other regional capital markets.
Unilever’s opposition to offload small amount of shares in the local stock markets was unfortunate, he said.
Unilever sells more than 40 products in the local market. The government earned around Tk 250 crore as dividend in last fiscal year.
Former interim government adviser Mirza Azizul Islam said it was unfortunate that the present government could not pursue the major multinational companies to offload shares in the stock market.
He said the government should bolster its efforts to implement its decision.
Sanofi Bangladesh Limited has been operating in Bangladesh, after amalgamation of Aventis Limited, Fisons (Bangladesh) Limited and Hoechst Marion Roussel Limited, since 2007.
The French drug maker is the leading multinational pharmaceutical company in Bangladesh.
Bank and Financial Instantiations Division officials said finance minister AMA Muhith held a meeting to review the decision last time in 2011.
They said the implementation of the decision was hampered due to the worst-ever share market crash early that year.
Since then no review has been made by the finance minister, they said.