Engro Foods has sold its majority stake to a Dutch company FrieslandCampina Pakistan BV (FC Pakistan). The deal is valued at an estimated $446.81 million.
The move is expected to bring in more products for Engro Foods now that the Netherlands-based dairy company holds a 51% stake in the Pakistani food company. Shares for Engro Foods were sold for Rs. 120 per share with 361.29 million shares acquired from the company and 29.66 million shares from the public. This data was revealed by Faiz Chapra, Company Secretary as Engro Foods issued a notification in this regard at the Pakistan Stock Exchange.
The news is expected to rally the bulls at the PSX, which recently hit a historic high with 47,000 points just yesterday.
Overall this year is looking to be great for Pakistani conglomerates, who have seen renewed interest from foreign buyers. Earlier this year, the Dawlance Group was also sold to Turkish investors for $258 million.
Based on the acquisition news, Engro Foods share price fell by Rs. 1.82 (1.05%) and closed at Rs. 170.03 on Monday. However, its parent company Engro Corporation’s share price rose by Rs. 2.53 (0.81%), buoyed by positive investor confidence in the company.
Speaking on the development, Chairman of Engro Foods Board of Directors, Samad Dawood had this to say about the news:
“This is only the beginning of a better and brighter future for our organisation and this novel partnership with the Royal FrieslandCampina Group will not only bring growth and prosperity for all of us but will also tell a story about Engro’s commitment to growth and creating a broad-based impact for now and generations to come.”
The company has mentioned that the final sale price will be forthcoming in the next 40 days after the closing statements are being prepared. Engro Corp and FrieslandCampina Pakistan will settle any price difference that is seen in estimated sale price and final sale price as per their sale and purchase agreement.