KARACHI: Service Global Footwear Limited (SGFL), Pakistan’s largest shoe exporter, on Thursday raised $14.23 million (Rs 2.2 billion) in an oversubscribed two-day book building process at the Pakistan Stock Exchange (PSX), financial advisers for the transaction said.
Last month Service said it was planning an initial public offering in the domestic market to raise funds to invest in its parent’s tire joint venture.
Service Global Footwear is part of Service Industries Ltd., which has more than 13,000 employees and is known for its shoes and tires in Pakistan. The footwear unit supplies brands including Inditex SA’s Zara, Levi Strauss & Co.’s Dockers and Reckitt Benckiser Group Plc’s Scholl. The business has an annual revenue of about $44 million and exports to European countries such as Germany, France and Italy. It has a capacity to produce 3.6 million pairs of shoes annually.
Thursday’s book building was oversubscribed 5.8 times, with the price closing at Rs53.2 per share against the floor price of Rs38.
Arif Habib Limited (AHL), the financial adviser for the transaction, said the book building saw a total demand of Rs8.95 billion received against the issue size of Rs1.55 billion million. Service received offers for 172 million shares against 40.9 million offered in the book building.
Around 454 investors participated in the book building, including major commercial banks, insurance companies, local and foreign institutions, asset management companies, TREC holders and high net worth individuals.
“This was one of the largest participation by investors,” Shahid Ali Habib, CEO at Arif Habib Limited (AHL), told Arab News. “The market is highly liquid, the interest rate regime is low, and the best asset class at present in the market is equity. These are major factors that induced large investor participation … Investors are taking interest in the equities which have potential growth and expansion with high returns”.
Service Global Footwear plans to use the IPO proceeds to buy about 18.91% stake in a joint venture set up by Service Industries and China’s Chaoyang Long March Tyre Co., Habib told media last month.
The joint venture, Service Long March Tyres (Private) Limited, is the first All Steel Radial Truck & bus (TBR) Tyre manufacturing unit in Pakistan. The project is expected to be completed by June this year.
SLM’s plant, estimated to cost Rs 16.43 billion, will have initial production capacity of 600,000 tires per annum — to be increased to 2,400,000 tires per annum by 2027 in three phases.
Pakistan’s largest shoe exporter raises $14.23 million to invest in Chinese tire company
https://arab.news/4uk3d
Pakistan’s largest shoe exporter raises $14.23 million to invest in Chinese tire company
- Service Global Footwear will use IPO proceeds to buy 18.91% stake in joint venture with China’s Chaoyang Long March Tyre Co
- Thursday’s book building was oversubscribed 5.8 times, with the price closing at Rs53.2 per share against the floor price of Rs38
Sindh vows stern action as builders complain of rising extortion in Pakistan’s commercial hub
- Association of Builders and Developers warned this week of receiving extortion calls from numbers based abroad
- Chief Minister Murad Ali Shah says will work with federal government to trace extortionists based in foreign countries
ISLAMABAD: The chief minister of Sindh on Thursday warned his government would take stern action against land grabbing and extortion a day after a prominent builders association warned the illegal practices were on the rise in Karachi, Pakistan’s commercial hub.
The Association of Builders and Developers (ABAD), a representative organization of private builders and developers in Pakistan, held a press conference in Karachi on Wednesday to warn that extortion and land grabbing activities were on the rise in the city.
ABAD Chairman Muhammad Hassan Bakhshi said at least 10 members of the association had received extortion calls over the past five months which demanded a total of Rs50 million [$178,000]. He said extortion calls were being made to builders from numbers based in Dubai and Iran.
Sindh Chief Minister Murad Ali Shah and a high-level delegation, including the provincial home minister, Karachi mayor, Karachi commissioner and chief secretary of the province, met an ABAD delegation led by Bakhshi.
“I have given clear instructions to the police to take immediate action on ABAD’s complaints,” Shah was quoted as saying by the Chief Minister’s Office.
The statement said Shah listened to ABAD’s press conference on Wednesday and felt the matter should have been brought directly to him, instead of being raised in the media.
“Under no circumstances can encroachment on land be permitted,” Shah said. “Clear instructions have already been issued to divisional and district administrations that I will not tolerate illegal occupation of land in any form.”
ABAD expressed its desire to work with the government in eliminating encroachments on lands owned by its members. During the meeting, the builders’ delegation handed over copies of extortion slips that they had received, along with the telephone numbers of those allegedly sending them from abroad.
ABAD’s leadership informed the meeting that about 10 cases of extortion had surfaced over the past year. Karachi police briefed the delegation on the progress made in those cases so far.
“Police launched an extensive operation and arrested 50 extortionists and sent them to jail,” Sindh Home Minister Zia-ul-Hasan Lanjar said, adding that six criminals had been killed in police encounters.
Shah, meanwhile, vowed that Sindh would take action with the help of the federal government against those orchestrating such extortion calls from abroad
“We have decided, with the support of the federal government, to proceed against those who sit abroad and make extortion calls,” he said. “We had earlier eliminated extortionists from this city, and we will once again bring them to justice.”
Karachi has had a history of political violence, where traders and members have frequently complained in the past of being extorted.
The Karachi Chamber of Commerce and Industry (KCCI) issued an urgent security advisory to its members in October citing a sharp uptick in extortion threats. It warned traders to install CCTV systems as cases of intimidation and violence rise across the city.
