A stock filing has revealed that Pakistan Refinery Limited and Air Link Communication have expressed their interest in acquiring a stake in Shell Pakistan.
Following various announcements regarding its global operations and citing economic challenges within Pakistan, Shell Petroleum Company has declared its decision to exit the country. As part of this exit strategy, Shell intends to sell its 77% shareholding in the local business based in Pakistan.
Next Capital Limited, acting as the managing entity, has officially submitted a Public Announcement of Intention on behalf of Pakistan Refinery Limited and Air Link Communication Limited (referred to as the “Acquirers”). The announcement states their intention to acquire 77.42% of shares and take control of Shell Pakistan Limited.
Airlink CEO Muzzaffar Hayat Piracha informed Reuters that the acquisition is a joint venture between PRL and Airlink, with specific details regarding shareholding between the two companies to be disclosed at a later stage.
Airlink CEO Muzzaffar Hayat Piracha stated that venturing into the petroleum business aligns with Airlink’s objective of diversification. Airlink, primarily known as a smartphone distributor, manufacturer, and retailer, sees this move as a strategic step in expanding its business portfolio.
Pakistan Refinery Limited (PRL), a subsidiary of Pakistan State Oil Company Limited, is one of the five refineries currently operating in Pakistan. PRL has not provided an immediate response to a request for comment.
The Reason
Shell Pakistan faced financial losses in 2022 attributed to factors such as exchange rate fluctuations, devaluation of the Pakistani rupee, and outstanding receivables. These challenges arose amid the ongoing financial crisis in the country and an overall economic slowdown.
Earlier, in a notification to Pakistan Stock Exchange (PSX), Shell Pakistan stated that during a meeting today, the Board of Directors of Shell Pakistan Limited (SPL) has been notified by Shell Petroleum Company Limited (SPCo) of its intent to sell its shareholding in SPL. “Any sale will be subject to a targeted sales process, the execution of binding documentation, and receipt of applicable regulatory approvals,” the statement read.
However, the company clarified that this announcement doesn’t impact SPL’s current business operations, which continue. “SPL remains committed to continuing to deliver safe and reliable operations for our customers and partners,” the statement read.
