• Lahore High Court has sanctioned the scheme of arrangement between NCPL and NCL, effective November 1, 24.
• To recall, Nishat Mills Limited (NML) is restructuring its investments in Nishat Chunian Limited (NCL) and Nishat Chunian Power Limited (NCPL). In this regard, with a share swap, NML will transfer its 14% stake in NCL to Shehzad Saleem, CEO of NCL, in exchange for his holding in NCPL.
• The agreed swap ratio is 1.93, implying that NML will receive 63.1 million NCPL shares in exchange for its 32.7 million NCL shares.
• NML’s stake in NCL will be eliminated after the transaction, while its ownership in NCPL will increase significantly from 7% to 24%.
• This reallocation will not alter the operational fundamentals or valuation of either NCPL or NCL, but it will modify the ownership structure.
• The restructured holding enhances NML’s value. Post-swap, its stake in NCPL will be valued at PKR 2.8bn, an increase from the current PKR 1.8bn combined value of NCL and NCPL in its portfolio.

Courtesy – AHL Research