The Board of Directors (BoD) of Service Industries Limited (PSX: SRVI) has made significant decisions regarding the restructuring of the company’s Tyres & Tubes and Retail segments.
According to the company’s notice to the Pakistan Stock Exchange (PSX), the BoD has opted to demerge and transfer the Tyres & Tubes segment, including its manufacturing facilities, to a wholly-owned subsidiary.
The creation of this subsidiary will be facilitated through a court-sanctioned scheme, contingent upon the finalization of relevant documentation and approval by the BoD of SRVI.
In addition to the Tyres & Tubes segment, the BoD has also decided to demerge and transfer the Retail segment of SRVI, along with all relevant assets, operations, and liabilities, to another wholly-owned subsidiary of the company. Like the Tyres & Tubes segment, this process is subject to the finalization of relevant documentation and approval by the BoD of the company.
Following the demergers, SRVI will retain ownership and operation of the remaining businesses, including its footwear unit and investments. The company aims to streamline its operations and focus on these retained segments post-restructuring.
Moreover, the BoD has approved an increase in the long-term equity investment in Service Long March Tyres (Private) Limited (SLM), an associated/subsidiary company.
The increase, up to Rs1.5 billion, will occur as and when required by SLM. This will be executed through the subscription, at par, of up to 150 million additional fully paid-up ordinary right shares of Rs10 each.
