Shwapno taps Japan’s Mitsui funds to strengthen footing

Shwapno, the country’s largest supermarket chain, plans to reduce financing costs and improve services through a strategic partnership with Japan’s Mitsui & Co Ltd and fresh investment from its parent company, ACI PLC.

The company signed an agreement yesterday with Mitsui to receive foreign currency-denominated convertible loans at low interest rates from the Japanese trading and investment firm.

The loans will be provided through Mitsui’s Singapore-based subsidiary, Mitsui & Co Asia Pacific Pte Ltd, subject to regulatory approvals, according to a press release.

The partnership will operate under a structured convertible loan facility, the statement added.

Operated by Advanced Chemical Industries (ACI) Logistics Limited (ACIL), Shwapno runs more than 836 stores across the country, serving a growing middle class that prefers convenient shopping.

Although its customer base and turnover are rising, the retail chain has yet to post a net profit despite recording an operating profit.

ACI has been posting losses partly due to losses at Shwapno, driven by high financing costs and rising bank loans that have increased its interest payment burden. To strengthen its position, the company has already received an investment of Tk 640 crore from ACI PLC, its parent company.

Sabbir Hasan Nasir, managing director of ACIL, told the Daily Star that the company is generating operating profit, but high finance costs are keeping net earnings in the red.

He said the equity investment from ACI PLC and the convertible loans from Mitsui & Co will help the company reach net profit soon.

“Especially, their technical know-how and expertise in retail will benefit Shwapno,” he added.

ACIL’s deal with Mitsui comes as modern retail continues to expand. In October last year, Indonesian retail giant Alfamart partnered with Kazi Farms Group to launch a convenience store chain in Bangladesh.

The statement said Mitsui, one of Japan’s leading multinational companies operating in more than 60 countries, brings not only financial support but also technical expertise, global sourcing strength, and wide cross-industry experience.ACI Logistics entered the retail sector in 2008 under the brand “Fresh and Near” to support its “Seed to Shelf” vision of connecting farmers directly with consumers. Starting with fresh produce and daily essentials, Shwapno outlets now offer products ranging from apparel and home décor to electronics and more.

The deal was signed at the ACI Centre in the presence of ACI PLC Chairman Anis Ud Dowla, Managing Director Arif Dowla, ACIL Managing Director Sabbir Hasan Nasir, and Kazuhide Nakajo, chief operating officer of the Consumer-Centric Business Development Unit at Mitsui & Co (Asia Pacific) Pte Ltd, along with senior representatives from both groups.