Lahore January 18 2022: The Board of Dost Steel Limited in their meeting held today has approved the offer from Mr. Khawaja Shartzeb Akram being the potential Investor (including his nominees) to invest up to 29 percent ordinary share capital of the Company.
This is done by way of issue of up to 128,961,717 ordinary shares at a price of PKR 4.07 per share (discount of 59.03 percent to par value) other than rights offer mechanism under the provisions of Sectiona 83 and Section 82 of the Companies Act 2017 (CA 2017) and subject to the approval of the shareholder of the company and the Securiities & Exchange Commission of Pakistan (SECP). This share price is equivalent to average 90 trading days volume weighted average price of the shares at the exchange.
This will help to generate equity injection of PKR 1,289,617,170 and funds received through such shares issued to the Investor shall utilized to settle the defaulted bank liabilities and to provide for/arrange working capital to revive operations of the Company. This will result in revival of the Company. In addition, the larger capital base will make the Company more financially secure as opposed to debt.
In the recent past scenario of the Company wherein the operations of the Company are halt due to lack of funding available to the Company and weaker market sentiments in respect of company’s shares. It is highly unlikely that shareholders of the Company may subscribe the share of the Company. In addition the Sponsors/Directors shall be unable to subscribe their portion of rights shares. In such a scenario the issue of shares otherwise than rights is the best option available in the best interest of the Company for resuming the operations of the Company.
The Board approved to increase the Authorized Share Capital of the Company from PKR 3,600 million to PKR 4,450 million under the provisions of CA 2017 and subject to the approval of the shareholders of the Company and the Securities & Exchange Commission of Pakistan.
Earlier, the Board of Directors of the Company in their meeting held on 27th February 2019. decided to make all efforts for potential investment, joint venture, strategic alliance / partnership to overcome the working capital crises in order to resume the operations of the Company. Pursuant to the efforts of the Board, a potential investor (including his nominees) has offered to invest in the Company at a discount
The funds received through such shares issued to the Investor shall utilized to settle the defaulted bank liabilities and to provide for/arrange working capital to revive operations of the Company. This will result in revival of the Company. The shares are proposed to he issued at a price equivalent to ninety percent (90%) of volume weighted average daily closing price of the shares of the Company prior to this announcement of issue of shares at discount i.e. till 17 January 2022.
The Board authorized the Chief Executive Officer of the Company to complete all necessary corporate, regulatory and legal formalities including execution of necessary documents, approval from the shareholders of the Company, lenders approvals and the Securities and Exchange Commission of Pakistan.
The shares are proposed to be issued at Mr. Khawaja Shahzeb Akram (including his nominees) upto 29% of the diluted share capital of the Company. Mr. Akram does not currently hold any shares in the Company, Mr. Akram is the Senior Vice President of Federation of Pakistan Chamber of Commerce and Industries (FPCCI).
Mr. Akram is also the CEO of Pharma Health Pakistan (Private) limited. He is also the Chairman of Derresthetic UK Limited and director of Gallop Water Sciences (Private) Limited and SJ&U Enterprises. He is also the member of Pakistan Drug Testing and Research Center, PDTRC and EC member of SAARC Chamber of Commerce and Industry and SAARC Chamber Young Entrepreneur forum. He has also been Chairman of Ferozepur Road Industrial Association and Pakistan Industrial and Traders Association Front.
