NAB authorises inquiry against Azgard Nine, Agritech Limited

KARACHI: The National Accountability Bureau (NAB) has authorised an inquiry against owners and directors of Azgard Nine Limited (ANL) and Agritech Limited (AGL) on corruption charges.

The accused include Azgard Nine Ltd CEO Abid Humayun Shaikh and CFO Abid Amin. The company
is a Lahore-based textile concern.

Additional Director for DG NAB Lahore Khawar Ilyas, in a notice to the Pakistan Stock Exchange (PSX) on Wednesday, said that NAB has authorised an inquiry against owners and directors of Azgard Nine Limited (ANL) and others on allegations of corruption as defined in section 9(A) of National Accountability Ordinance, 1999.

NAB had filed a reference before an accountability court in Karachi against the officials alleging that they engaged in ‘debt swap and master restructuring of loans’ schemes on fraudulent grounds.

According to the reference, Azgard Nine’s officials had devised a plan to settle the debt of 22 financial institutions, amounting to Rs10.5 billion, including Rs3.41 billion of National Bank of Pakistan (NBP) using debt swaps and master restructuring of loans.

Reportedly, the alleged scheme involved the banks purchasing shares of Agritech Ltd, a subsidiary of Azgard Nine, at a rate far above their market price. Azgard Nine then used the proceeds from the sale to settle a large part of the money owed to NBP and others.

A NAB investigation showed that the stock was purchased at Rs35 per share whereas its market price at the time was Rs13.47, with a calculated loss to the national exchequer to the tune of Rs3.3 billion.

According to the reports, the reference claims that the pricing mechanism, whereby the shares were valued at such a premium over their market rate, was devised by Ilyas, then chief of corporate and investment banking group at NBP. The allegedly fraudulent price was then approved by Brohi, Hussain, Adil and Bengali in their capacity as members of NBP’s credit committee.

After the news, Agritech Ltd’s and Azgard Nine’s stocks fell at local bourse on Wednesday as the value of Agritech Ltd went down to Rs7.57 per share from Rs 8.51 per share, while the stock of Azgard Nine closed at Rs16.84 per share against opening price of Rs 17.70 per share.

Published in Daily Times, March 8th 2018.