Local firms withdraw bid for Shell Pakistan
ISLAMABAD: Local investors have stepped back from their plans to acquire a stake in Shell Pakistan Ltd, following the announcement of a finalised deal between the company’s parent entity and a Saudi Arabian group.
Pakistan Refinery Ltd (PRL) and Air Link Communication Ltd, two of the interested local investors, officially communicated their withdrawal to the Pakistan Stock Exchange (PSX) on Wednesday, marking an end to their bid for the energy company.
Muzaffar Paracha, CEO of Air Link, explained the move as a procedural necessity aimed at keeping the regulatory body informed about their investment decisions. “This is a legal requirement to inform the regulator about the intentions to invest or not to invest in any scrip,” Mr Paracha told Dawn.
He revealed that Shell Petroleum Company Ltd (SPCo) and Wafi Energy Company LLC, a notable fuel station operator in Saudi Arabia, have concluded a share purchase agreement for SPCo’s entire holdings in Shell Pakistan Ltd.
“Now, when Shell Pakistan Ltd has shared the development with the stock exchange, the legal requirement was that either we withdraw our intentions to purchase Shell Pakistan’s interests or challenge the deal on any ground, but that would be an irrational move,” Mr Paracha added.
Shell Pakistan operates under the global energy conglomerate Royal Dutch Shell Plc and has been a significant player in the country’s petrochemical sector. The decision to sell its shareholding was publicised in June 2023, with SPCo holding a substantial 77.42 per cent stake in the company as of December 2022.
The transfer of stakes to Wafi Energy is contingent upon several conditions, including a public offer by the Saudi company on the PSX and obtaining necessary approvals, such as clearance from the Competition Commission of Pakistan (CCP).
Published in Dawn, April 4th, 2024