Acquirers withdraw bid to acquire Engro Powergen Qadirpur stake

Liberty Mills Limited, along with associated parties, has withdrawn its public announcement of intention (PAI) to acquire a 68.89% stake in Engro Powergen Qadirpur Limited, according to a notification issued to the Pakistan Stock Exchange (PSX) on Friday by Arif Habib Limited, the manager to the offer.

The original PAI was made on February 26, 2024, and involved Liberty Mills Limited, Zain Ashraf Mukaty, Temoor Ashraf Mukaty, Ahmed Ashraf Mukaty, Soorty Enterprises (Pvt) Limited, Affinity Capital (Pvt) Limited, Najeeb Malik, Nadeem Malik, and Shahzad Malik. 

The intention was to acquire a majority shareholding in the company. An addendum was later issued on May 17, 2024, followed by an extension announced on August 23, 2024, subject to regulatory approvals. 

The deadline for making the public offer was set to expire on November 24, 2024.

In its notification, Arif Habib Limited confirmed that the acquirers have opted not to proceed with the transaction, allowing the PAI to lapse on its expiry date. 

The withdrawal is being undertaken in compliance with Regulation 21(1) of the Listed Companies (Substantial Acquisition of Voting Shares and Takeovers) Regulations, 2017, as well as the Securities Act, 2015.

The notice further highlighted that the withdrawal ensures full adherence to regulatory requirements and invited stakeholders to contact Arif Habib Limited for any additional information or clarification. 

The Competition Commission of Pakistan (CCP) also recently approved the acquisition of 11.9% shareholding in Sindh Engro Coal Mining Company (SECMC) by International Electric Power (Private) Limited, established in March 2024 for this transaction.

This acquisition, valued at Rs 6.21 billion, was part of a broader divestment strategy by Engro Energy Limited, including shares in SECMC, EPQL, and Engro Powergen Thar Limited (EPTL).

Engro’s Divestment and Sectoral Shifts Engro Energy’s divestment reflects its strategic pivot away from thermal energy assets amid Pakistan’s evolving energy landscape. SECMC, a joint venture among the Government of Sindh, Engro Energy, and others, has emerged as a critical player in Pakistan’s coal mining sector, contributing significantly to domestic energy production.

Since its inception, SECMC has demonstrated robust financial performance, with notable profitability and growth metrics in recent years. With the Liberty consortium out, Engro will have to once again look for buyers of its Qadirpur plant.

Liberty’s withdrawal from EPQL’s acquisition raises questions about market confidence and investor sentiments about non-renewable energy.