Engro Corporation Ltd has sold off 295 million shares of its subsidiary – Engro Fertilisers Ltd – to local and foreign institutional investors and high net worth individuals (HNWI) by way of a private placement at a price of Rs65.47 per share. The price, according to the company, was calculated through a private book building mechanism.
Engro Fertilisers Ltd is considered to be the most profitable subsidiary of Engro Corp Ltd and thus the sale of a part of equity surprised some investors in the market. Through the sale of 295m shares, the parent company has reduced its stake to 57pc from 79pc.
The CEO of Engro Fertiliser Mr Ruhail Muhammad believes that the divestment was probably a part of achieving the holding company’s strategic objectives with respect to its subsidiaries. It is also believed that the proceeds from this sale of shares would be used to finance new projects such as Sindh Engro Coal Mining Company and facilitate in diversifying the company’s portfolio.
