Sunridge Foods (Private) Limited, a wholly-owned subsidiary of Unity Foods Limited (PSX: UNITY), has announced an increase in its ownership stake in Al Shaheer Corporation Limited (PSX: ASC) to 18.42%. This was achieved by acquiring an additional 37,123,188 voting shares of Al Shaheer Corporation Limited, as disclosed by UNITY in its report to the local stock exchange on Monday.
As a result of this acquisition, Sunridge Foods now holds a total of 69,064,774 shares in Al Shaheer Corporation Limited, representing 18.42% of the company’s total issued voting shares.
As per Market sources, Unity Foods had previously negotiated with ASC Sponsors for taking over the company, however, the terms were not acceptable to the Sponsors.
Now Unity Foods, through its subsidiary Sunridge Foods has accumulated Shareholding in Al-Shaheer Corp through Block deal in the Market. With ASC’s free float of 80% in the market, it is highly likely that Unity Food will be able to get more holding possibly up to 50% in near future.
On the other Hand, Al-Shaheer’s Sponsors will try to block any such move where, any party will get significant holding of the company. This is expected to lead to Hostile Takeover bid.
Al Shaheer Corporation Limited is actively involved in the processing and trading of various types of halal meat, including goat, cow, chicken, and fish. Their operations cater to both export markets and local sales through a network of retail outlets.
UNITY, on the other hand, has diversified its business portfolio to encompass a wide range of agricultural products, encompassing Edible Oil, Staples (such as Flour, Rice, Lentils, and Pulses), Industrial Fats, and various feed ingredients tailored for the poultry and livestock sector.
Pertinent to note is the fact that ASC’s existing shareholders, excluding key sponsor, are not satisfied by the Sponsor/Management of the company as Company hasn’t produced any tangible profit in since its listing. ASC had gathered massive Funding in its IPO listing and subsequent rounds of Right Shares Offerings.
Despite raising billions of Rupees from Shareholders, ASC has failed to perform. Its Ready to Eat, Ready-to-Cook Brand “Chef-One” couldn’t sustain the market competition and was scaled down owing to Recurring Losses. While it couldn’t mark a niche in Export Markets, despite Optimal pricing of Pakistani Meat.
ASC has previously closed down multiple “Meat One” outlets due to low Revenue and high operating costs.
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