Bangladesh-based denim fabric producer Envoy Textiles Ltd. is planning to set up a yarn spinning unit, 80 percent of which will be used for internal consumption, with the rest to be sold in the open market.
The spinning unit, to be set up at a cost of around Taka 235 crore, is expected to begin commercial production in the first quarter of 2016, the Daily Star reported.
Earlier on August 18, Envoy Textiles signed an agreement with HSBC Bank and BRAC Bank, who both together will finance about USD 20 million of the project cost.
The new spinning plant will have a yarn production capacity of 17,500 tons per annum.
"We will be a fully vertically integrated textile manufacturer after installation of the plant”, said Abdus Salam Murshedy, MD of Envoy Textiles.
He added, “Yarn produced at the unit will reduce the cost of production and increase the quality of our products and we will be able to be more competitive in the international markets.”
The bank borrowing, which will be under offshore financing arrangement for a maximum of five years, is subject to final approval from authorities.
The major machineries to set up the spinning unit will be imported from Germany, Switzerland and Japan.
