SHC pauses Quice Food-Indus merger, seeks SECP report on shareholder dispute

The Sindh High Court (SHC) has put the proposed merger between Quice Food Industries and Indus Food Products on hold, ordering that no further action be taken until it reviews a shareholder challenge after the court's summer vacation.

The direction came while hearing Judicial Companies Miscellaneous No. 43 of 2026, filed by shareholders holding a combined 26.87% stake in Quice Food. As part of the interim order, the court directed the Securities and Exchange Commission of Pakistan (SECP) to submit a report detailing the parties' shareholding recorded with the regulator and its position on the contested merger. Notices were also issued to the respondents.

The petition centres on an Extraordinary General Meeting (EGM) held on June 23, 2026, where Quice Food announced that its shareholders had approved the merger with Indus Food Products.

However, the petitioners argue that the transaction does not meet the approval threshold prescribed under Section 279(2) of the Companies Act, 2017, which requires the support of at least 75% of a company's general body. They maintain that opposition from shareholders representing 26.87% of the general body means the statutory requirement could not have been fulfilled.

In addition to contesting the outcome, the shareholders have challenged the conduct of the meeting itself, alleging they were prevented from voting and were deliberately excluded from the electoral process.

The proposed transaction has faced legal scrutiny before. In an earlier petition, Judicial Companies Miscellaneous No. 29 of 2026, shareholders questioned the share-swap ratio approved by Quice Food Industries' board of directors and raised concerns over the transparency of Indus Food Products' financial position.

The matter will now be taken up in the first week after the court's summer vacation, with the merger process remaining suspended until further orders.