KARACHI: Pak Suzuki Motor Company Ltd (PSMC) said on Thursday its overseas sponsor controlling the majority shareholding will purchase all outstanding shares and delist the company from the Pakistan Stock Exchange (PSX).
The Japanese automaker told investors on Thursday the proposed delisting will be “beneficial” for the minority shareholders as they’ll get the opportunity to make a “fair exit” given their “unfavourable situation”.
“PSMC has faced some challenging times and [the overseas sponsor] is of the view that the minority shareholders should not suffer, especially on account of the low price the shares had been trading at,” a spokesperson for the company said in a separate statement.
The company has posted net losses in three of the last four years. Shareholders haven’t received any dividend since 2019, except for 2021.
As a result of the announcement, the share price of PSMC rose 7.5 per cent to Rs205.94 on Thursday as investors hurried to accumulate the stock in anticipation of a considerably higher price at which voluntary delisting may take place. The share price has risen 43.5pc from a week ago when the company first announced its intention to delist.
The market value of the automaker’s share has been subdued in recent months because the extended shortage of dollars in the national kitty has forced the firm to reduce its imports and scale down production.
In the first quarter of 2023-24, car sales clocked in at 20,983 units, down 40 per cent from a year ago. PSMC accounted for 52pc of the total units sold in July-September, even though its sales declined 34pc unit-wise on a year-on-year basis.
Published in Dawn, October 20th, 2023
Source: dawn.com