Fauji Cement Company limited (FCCL) approves the amalgamation scheme with Askari cement limited (ACL). FCCL has informed the stakeholders of a board of approval in their latest notice to Pakistan stock exchange. In accordance with the Companies Act 2017, all of the assets and properties of the ACL will be transferred to the FCCL whereas the shareholders of Askari cement will be provided a holding in the FCCL according to a share swap scheme which would be of 5:1.
FCCL, with a very impressive market cap of 1,379.815 million shares, has issued 160 million shares to its existing owners. The ACL shareholders will be awarded with a total of 800.493 million new shares of FCCL as per the stated swap agreement. The market share capital of Fauji cements will rise up to 2,180.309 million shares after this merger.
Subsequently, the annual capacity of ACL is 2.80 million tons against Fauji cement’s capacity which resides at 3.43 million tons which gives the fact that an 82 percent of the overall addition to the capacity that s currently present. This capacity along with the 2.05 million tons of greenfield expansion that FCCL announced and the ACL’s 2 million tons expansion of the brownfield, will result in FCCL to become the third largest stakeholder in the country with a combined total capacity of 10.3 million tons. This deal is going to prove to be beneficial for both the companies after the merger and expansion. FCCL’s book values will rise up from Rs. 17.85 per share to Rs. 21.78 per share according to the latest available financials provided.