Distressed Azgard 9 to sell its manufacturing plant for Rs825 million

In business, as in life, it sometimes pays to be a little superstitious. Clearly, the management of Azgard 9 thought so, and when naming their denim company, decided to draw on all the luck from different world cultures. As they explained in one of their annual reports, the term Azgard is a reference to one of the nine worlds in Norse mythology, protected from the powers that be by the Norse god Heimdall. Meanwhile, the number nine is taken from China, where it represents ‘change’ and ‘transformation’. The number nine in Ancient Greek mythology represented fulfillment of creation. 

And that is how, Azgard 9, decided to officially form its company on the ninth day of February in 2004, by nine members, so that it could ‘sow the seeds for an auspicious and rewarding future’. 

Fast forward some 16 years later, and one can imagine Azgard’s management wondering where their luck went. In a notice issued to the Pakistan Stock Exchange (PSX) on December 30, the company said that its garment unit located at Ruhi Nala, Lahore, was being sold by the creditors of the company as a security enforcement action. The price of the entire unit, including plant and equipment? A hefty Rs825 million. The sale agreement was executed on December 9. 

The creditors were able to do this because of a Lahore High Court order from July 2018, where a Creditors’ Scheme of Arrangement was sanctioned. Still, the company remained hopeful, despite losing a whole denim unit. “The sale of said FPS unit will not affect the business of the company, as the company has arranged sufficient production facilities to cater to business requirements,” it said, without specifying what those requirements were. 

How did it come to this? Let us look back at the history of the company.