Fu-wang Foods lays off factory for six months amid gas crisis

Image

Fu-wang Foods, a listed food product producer, has decided to lay off its factory for six months due to inadequate gas pressure and rising raw material prices.

This is the first time that any listed firm has announced a lay-off amid the recent gas crisis.

Tap here to add The Daily Star as a trusted source

In a disclosure on the website of the Dhaka Stock Exchange (DSE), the company, classified in the junk or Z category, informed today that the board of directors had decided to lay off the factory for a six-month period, effective from August 22, 2026.

Although the company blamed the recent gas crisis for its lay-off, the company was already struggling. It failed to provide any dividend for the last two fiscal years and even failed to hold its annual general meeting, so it was downgraded to the Z category.

It incurred a loss of Tk 3.7 crore in the first three quarters of 2024-25. Later, it did not publish any financial reports.

The situation was so dire that the company told the DSE in October 2027 that an auction had been held of the head office of Fu-wang Foods Limited by Dhaka Bank Limited against a loan provided by the bank. The company informed the DSE in response to a notice.

The company also said, “We negotiate with the officials of Dhaka Bank Limited to mitigate the loan status with our company.”

“At the same time, we are going to move a writ petition subject to consideration of the loan status of the company and hope to settle the issue with the bank in a short period of time,” it said.

Mohammad Zaman, company secretary of the food company, told The Daily Star that the bank issue had already been resolved as the loan was rescheduled.

“Now, raw material prices have risen while gas pressure is also limited. For both problems, the board decided to lay off the factory,” he said.

Meanwhile, the impact of the gas crisis that began on July 21 this year is spreading across the country’s industrial belts, with factories cutting production, shutting units and sending workers on leave.

Factory owners said gas pressure, which had gradually declined before the latest crisis, fell from the normal 15 pounds per square inch (PSI) to 2-4 PSI last week and then to almost zero over the past few days.

Today, its shares dropped 0.89 percent to Tk 11.10 at the DSE.