Pak Suzuki’s profits boomed in 2024, right after its buyback. Minority shareholders won’t be happy

Ramada Hotel in Karachi. April 29, 2024. With the commercial airline jets flying overhead, the conference room is getting heated by the second. Suddenly one of the minority shareholders gets up and says “Agar ek bud dua lag gai tu paeer sa chappal bhi nikal jai gi” and further added, "apko kafan bhi naseeb nahi ho ga.” 

These words would seem appropriate for an overdramatized soap opera in an argument between the evil saas and disobedient bahu. Not in an Annual General Meeting of a publicly listed company. The rebuke becomes even starker when it is considered that Pak Suzuki is a company with Japanese directors and shareholders for whom respect is codified as sonkei from a very early age. The act of bowing, speaking politely and using proper honorifics is at the core of the culture. So what was the reason that such strong words were being used?

For the beginnings of this contentious issue, we have to go back even further. The issue began when Suzuki Motor Company in Japan announced that they were the largest shareholder of Pak Suzuki were interested in buying back the shares of the company and delisting it from the Pakistan Stock Exchange on a voluntary basis. The treatment of the minority shareholders during the buyback and the way it was carried out left a bad taste in the mouth. 

It has almost been a whole year since the buyback of Pak Suzuki was carried out and it seems that there are still aftershocks and bad blood that has continued between the two parties. The latest development in this story is the release of the latest financial statements which has created a new schism between the two sides. 

From the outset of the buyback being announced, there were allegations that the company was looking to carry out the buyback at a price favourable to itself and was short changing the minority shareholders while doing so. With the release of its latest financial statements, the doubt over the claims made seems to have reared their ugly head yet again as the company has been able to declare a profit after many years. The company will contend that the rebound is legitimate and warranted. The minority will disagree. Where does the truth actually lie?