Mehmood Textile to demerge apparel unit into wholly owned subsidiary

KARACHI: The Board of Directors of Mehmood Textile Mills Limited (PSX: MEHT) has approved the demerger of its apparel unit, transferring it to MG Apparel Limited, a wholly owned subsidiary, the company informed the Pakistan Stock Exchange on Tuesday.

As part of the demerger, certain leasehold immovable properties in the Multan Industrial Estate will also be shifted to MG Apparel. The step is aimed at enhancing operational efficiency, improving visibility of the apparel division’s performance, and allowing it to leverage value-added incentives offered by statutory authorities.

The Board has also approved a Scheme of Arrangement to execute the demerger, with the company’s management authorised to complete all required legal formalities, including petitioning the Lahore High Court, Multan Bench under Sections 279 to 283 and 285 of the Companies Act, 2017.

The restructuring marks a strategic step toward streamlining Mehmood Textile’s business segments and potentially unlocking greater shareholder value through focused operations.