The Securities and Exchange Commission of Pakistan (SECP) has approved the application of M/s Organic Meat Company Limited to issue, circulate and publish the prospectus for initial public offering (IPO) of the company’s shares in the stock exchange.
According to a report by a local media outlet, the company will have 60 days to publish the details of proposed offering in the prospectus and offers its shares to the public from the date of approval.
The company intends to raise Rs. 720 million at floor price of Rs. 18 per share through the IPO. This will be the first IPO of 2020 and will be the second meat company to enter the stock market as Al Shaheer Corporation was listed in June 2015.
According to the initial draft issued by the company to PSX, the entire issue of 40,000,000 ordinary shares will be offered through the book-building process at a floor price of PKR 18.00/- per share (including a premium of PKR 8.00/- per share) with a maximum price band of up to 40%.
Initially, 75% of the issue size i.e. 30,000,000 ordinary shares will be allotted to successful bidders and 25% of the issue i.e. 10,000, 000 ordinary shares will be offered to retail investors.
An individual and institutional investor’s bid amount should be no less than the minimum bid size of PKR 2,000,000 (Two Million Rupees only). Unsubscribed shares, if any, of the general subscription portion will be allocated to successful bidders of the book building portion on a pro-rata basis.
In order to promote capital formation through the securities market, the SECP has recently made amendments in its regulatory regime for IPOs.
Through amendments in IPO Regulations 2017, the eligibility criteria for listing of companies were simplified and the IPO process was made simple and cost-effective to attract new listings. This will help to attract new listings, improve capital formation & ease of doing business.