KARACHI – In a significant development in the disputed takeover of TRG Pakistan Limited (PSX: TRG), the Securities and Exchange Commission of Pakistan (SECP) has directed AKD Securities Limited (AKDSL), manager to the public offer, to honour shareholder requests for the return of shares already tendered in the acquisition process. The directive, dated May 26, comes amid legal proceedings that have stalled the finalisation of the deal.
In a notice to the Pakistan Stock Exchange on Wednesday, AKDSL confirmed that it will accept such requests until June 18, 2025, ahead of the book closure period for the revised public offer. The returned shares will be eligible for re-tendering during the new acceptance window from July 2 to July 8, 2025.
The SECP’s decision allows shareholders who had previously tendered their shares under Greentree Holdings Limited’s public offer to reclaim them temporarily, in light of JCM 12 of 2025—a legal challenge underway in the Sindh High Court. Shareholders who exercise this option will forfeit any pending payments, which will now be contingent on the court’s final ruling.
The public offer, initiated by Greentree Holdings Limited, a wholly owned subsidiary of TRG International, sought to acquire 35.14% of voting shares in TRG Pakistan. The transaction, however, became mired in controversy after minority shareholders filed petitions alleging regulatory violations under Section 86(2) of the Companies Act, 2017, which prohibits companies from indirectly financing their own share buybacks without government approval.
According to extensive reporting by Profit, concerns were raised over the funding structure of the acquisition. Initially, Greentree Holdings stated in its public filings that the acquired shares would be transferred back to TRG Pakistan, raising red flags over a potential “round-trip” transaction, or wash trade, which would effectively allow the company to finance its own buyback through a subsidiary.
Subsequent legal and regulatory scrutiny led to a stay order from the Islamabad High Court, and the matter is now under adjudication in the Sindh High Court, where the legitimacy of the acquisition structure is being contested.
The SECP’s latest guidance is aimed at mitigating shareholder risks, especially for retail investors whose shares have been locked up without resolution since January. Some investors had voiced concerns over liquidity constraints, noting that the prolonged blocking of their shares had led to financial losses amid a broader market rally.
While Greentree Holdings and AKD Securities have not disclosed whether any changes will be made to the structure of the offer, industry observers suggest that the SECP’s intervention signals heightened regulatory oversight, particularly for transactions involving related-party funding and potential governance loopholes.
With the acceptance period now rescheduled and shareholder withdrawals permitted, the fate of the TRG Pakistan buyback remains tied to the outcome of court proceedings. The SECP has maintained that no payments will be made for tendered shares until the litigation concludes.
The case is widely viewed as a precedent-setting moment in Pakistan’s corporate governance landscape, testing both regulatory vigilance and the integrity of public acquisition processes.
