Abul Khair Group (AKG), a market leader in Bangladesh’s steel industry, embarked on an ambitious journey in 2012 with the establishment of Abul Khair Steel Melting Limited (AKSML). To achieve economies of scale and enhance backward integration, AKG aimed to set up the country’s largest steel billet manufacturing plant with an annual capacity of 1 million metric tons (MT). This project would significantly reduce the reliance on imported raw materials and transform the local steel market. HSBC, appointed as the lead arranger for raising USD 90 million in debt, reached out to ICD to participate in the financing. The total project cost amounted to USD 290 million, with USD 109 million contributed as equity. ICD, along with HSBC and Prime Bank of Bangladesh, provided long-term financing, forming part of the USD 182 million required. The plant’s cutting-edge equipment was sourced from Danieli, Italy.

With the successful completion of the greenfield project, AKSML bolstered AKG’s position in the market by producing billets, the primary raw material for long steel products. The project not only addressed local demand but also contributed to substantial foreign exchange savings by reducing billet imports.

AKSML repaid the entire facility on time and approached ICD again in 2023 for additional financing of EUR 27 million to expand its production capacity further. By then, AKSML had merged with Abul Khair Steel, increasing its billet production capacity to 2.2 million MT and long steel production to 1 million MT annually. With ICD’s financing, AKSML aims to raise its production capacity to 2.6 million MT per annum, meeting the growing market demand.

This financing marked a significant milestone for ICD, showcasing its ability to support transformative projects that address critical needs. The project also fostered local expertise, as Bangladeshi engineers, supported by foreign experts, played a pivotal role in constructing and operating the complex steel plant. AKSML’s success stands as a testament to ICD’s commitment to driving industrial growth and sustainable development in its member countries.