Pak Suzuki Director Election Delay Amid PSX Delisting

Abdullah

03 Jan 2024

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Pak Suzuki Director Election Delay Amid PSX Delisting

The Securities and Exchange Commission of Pakistan (SECP) has granted permission to Pak Suzuki Motor Company Limited (PSX: PSMC) to conduct its upcoming director election within 90 days from the due date, set for May 7, 2024. The automaker conveyed this information to the Pakistan Stock Exchange in a Wednesday announcement.

Term Expiry and Delisting Process Impact

The current term of the elected directors is scheduled to conclude on February 6, 2024. Due to the ongoing voluntary delisting process, the company sought an extension for the election of directors from the SECP. The directors filed an Impediment Report under section 158 (2) of the Companies Act, 2017, as mentioned in the stock filing.

SECP's Approval

In response to the request, the SECP issued a letter dated January 2, 2024, with the reference number E-0010695/Com/2024/X3711, permitting the company to hold its director election within 90 days from the due date, i.e., by May 7, 2024.

Delisting Proposal and Share Purchase

In December 2023, PSMC formally submitted a request to delist from the PSX. An earlier filing disclosed that Suzuki Motor Corporation (SMC) Japan, the majority shareholder, aims to purchase 26.91 percent of the paid-up share capital from minority shareholders at a minimum price of Rs. 406 per share, following PSX rules.

Why Delist?

The primary motive behind the delisting proposal is for SMC to attain full ownership of the company by acquiring all outstanding shares and securities held by minority shareholders. The move is driven by the desire to increase ownership and address the company's financial challenges, given the operational losses in 2019, 2020, 2022, and up to the 3rd quarter of the fiscal year 2023.

Pak Suzuki SECP PSX PSMC Director Election Voluntary Delisting Suzuki Motor Corporation Minority Shareholders Financial Challenges Operational Losses Corporate Governance

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