Offer Document | KSB | ||||
Pumps | |||||
`
ADVICE FOR INVESTORS
INVESTMENT IN EQUITY SECURITIES AND EQUITY RELATED SECURITIES INVOLVES A CERTAIN DEGREE OF RISK. THE INVESTORS ARE REQUIRED TO READ THE RIGHTS SHARE OFFER DOCUMENT (HEREIN REFERRED TO AS 'OFFER DOCUMENT') AND RISK FACTORS CAREFULLY, ASSESS THEIR OWN FINANCIAL CONDITIONS AND RISK- TAKING ABILITY BEFORE MAKING THEIR INVESTMENT DECISIONS IN THIS OFFERING.
RIGHT ENTITLEMENT LETTER IS TRADABLE ON PSX, RISKS AND REWARDS ARISING OUT OF IT SHALL BE SOLE
LIABILITY OF THE INVESTORS.
THIS DOCUMENT IS ISSUED FOR THE PURPOSE OF PROVIDING INFORMATION TO SHAREHOLDERS OF THE COMPANY AND TO THE PUBLIC IN GENERAL IN RELATION TO THE RIGHTS ISSUE OF PKR 1,947,000,000 CONSISTING OF 17,700,000 NEW ORDINARY SHARES BY KSB PUMPS COMPANY LIMITED. A COPY OF THIS DOCUMENT HAS BEEN REGISTERED WITH THE SECURITIES EXCHANGE.
THIS OFFER DOCUMENT IS VALID TILL OCTOBER 15, 2024 (60 days from the last day of payment of subscription
amount)
KSB PUMPS COMPANY LIMITED
Right Share - Offer Document
Date and place of incorporation: July 18, 1959, Lahore, Incorporation number: 0001024, Head Office: 16/2, Sir Aga
Khan Road, Lahore, Contact No: +92-42-111-572-786,Website:https://www.ksb.com/en-pk/,Contact Person: Mr.
Faisal Aman Khan, Phone: +92(42) 111-572-786,Email: faisal.aman@ksb.com.pk
Issue Size: The Issue consists of 17,700,000 Right Shares (i.e. approximately 134.0909% of existing paid-up capital of
KSB Pumps Company Limited) having face value of PKR 10/- each at an offer price of PKR 110/- each (including a
premium of PKR 100/- per share). The total amount to be raised through the right issue is PKR 1,947,000,000.
Date of Placing Offer Document on PSX for Public Comments: | N/A (Public comments are not being sought) |
Date of Final Offer Letter: | June 25, 2024 |
Date of Book Closure: | From July 04, 2024 to July 10, 2024 |
Subscription Amount Payment Dates: | From July 18, 2024 to August 16, 2024 |
Trading Dates for Letter of Rights: | From July 18, 2024 to August 08, 2024 |
Page 1
Offer Document | KSB | ||||||||
Pumps | |||||||||
Details of the relevant contact persons: | |||||||||
Name of | Contact | ||||||||
the | Designation | Office Address | Email ID | ||||||
Number | |||||||||
Person | |||||||||
Authorized | Mr. Faisal | Company | +92(42) | 16/2 Sir Agha | |||||
Officer | Aman | 111-572- | Khan Road | faisal.aman@ksb.com.pk | |||||
Secretary | |||||||||
of the Issuer | Khan | 786 | Lahore | ||||||
Underwriters to the Issue | |||||||||
2/F, Arif | |||||||||
Arif Habib | Mr. Taha | Chief Financial | +92 (21) | Habib Centre, | |||||
111-245- | taha.siddiqui@arifhabibltd.com | ||||||||
Limited | Siddiqui | Officer | 23, M.T. Khan | ||||||
111 | |||||||||
Road, Karachi | |||||||||
17th Floor, | |||||||||
Dawood | Mr. Abdul | Chief | +92 (21) | Saima Trade | |||||
Equities | Executive | Tower 'A', I.I. | aziz@dawoodequities.com | ||||||
Aziz Habib | 32275200 | ||||||||
Limited | Officer | Chundrigar | |||||||
Road Karachi | |||||||||
Bankers to the Issue | |||||||||
Spencer's | |||||||||
Building, | |||||||||
Habib | Syed | Team Lead | Transaction | ||||||
Sales (South) | +92 (21) | Banking, | Mairaj.hassan@habibmetro.com | ||||||
Metropolitan | Mairaj | ||||||||
Transaction | 32644571 | Mezzanine | |||||||
Bank Limited | Hassan | ||||||||
Banking | Floor, I.I. | ||||||||
Chundrigar | |||||||||
Road, Karachi | |||||||||
This Offer Document can be downloaded from https://www.ksb.com/en-pk/investor-relations/investor-informationand https://www.psx.com.pk/
(This space has been left blank intentionally)
Page 2
Offer Document | KSB | ||||
Pumps | |||||
Undertaking by the Chief Executive Officer and Chief Financial Officer
Page 3
Offer Document | KSB | ||||
Pumps | |||||
Undertaking by the Company Secretary an officer of the Company authorized by the Board
of directors of the company in this behalf
Page 4
Offer Document | KSB | ||||
Pumps | |||||
DISCLAIMER:
- In line with Companies Act, 2017 and Companies (Further Issue of Shares) Regulations, 2020, this document does not require approval of the Securities Exchange /Pakistan Stock Exchange Limited and the Securities and Exchange Commission of Pakistan (SECP).
- The Securities Exchange and the SECP disclaims:
- Any liability whatsoever for any loss however arising from or in reliance upon this document to any one, arising from any reason, including, but not limited to, inaccuracies, incompleteness and/or mistakes, for decisions and/or actions taken, based on this document.
- Any responsibility for the financial soundness of the Company and any of its schemes/projects stated herein or for the correctness of any of the statements made or opinions expressed with regards to them by the Company in this Offer document.
- Any responsibility with respect to quality of the issue.
- It is clarified that information in this Offer Document should not be construed as advice on any particular matter by the SECP and the Securities Exchange and must not be treated as a substitute for specific advice.
(This space has been left blank intentionally)
Page 5
Offer Document | KSB | ||||
Pumps | |||||
GLOSSARY OF TECHNICAL TERMS | |
ACT | Securities Act, 2015 |
CDC | Central Depository Company of Pakistan Limited |
CDS | Central Depository System |
Companies Act | Companies Act, 2017 |
IAS | Investor Account Services |
LoR | Letter of Rights |
Mn | Million |
NICOP | National Identity Card for Overseas Pakistani |
PKR or Rs. | Pakistan Rupee(s) |
PSX /Securities Exchange | Pakistan Stock Exchange Limited |
USD | United States Dollar |
(This space has been left blank intentionally)
Page 6
Offer Document | KSB | ||||
Pumps | |||||
DEFINITIONS | |||
Application Money | The total amount of money payable by existing shareholder which is | ||
equivalent to the value of shares to be allotted. | |||
Habib Metropolitan Bank Ltd has been appointed, in this Right Issue, as the | |||
Banker to the Issue | Banker to the Issue, with whom an account is opened and maintained by | ||
the Issuer for keeping the issue amount. | |||
Book Closure Dates | The Book Closure shall commence from July 04, 2024 to July 10, 2024 (both | ||
days inclusive). | |||
Company | KSB Pumps Company Limited (the "Company" or "KSBP" or the "Issuer"). | ||
Commission | Securities and Exchange Commission of Pakistan ("SECP"). | ||
Issue | Issue of 17,700,000 Right Shares representing approximately 134.0909% | ||
of total paid-up capital of the Company. | |||
Issue Price | The price at which Right Shares of the Company are issued to the existing | ||
shareholders (PKR 110/- per share). | |||
Ordinary Shares | Ordinary Shares of KSB Pumps Company Limited having face value of PKR | ||
10/- each. | |||
Companies (Further Issue of Shares) Regulations, 2020 | |||
Regulations | https://www.secp.gov.pk/document/the-companies-further-issue-of- | ||
shares-regulations-2020-updated-march-4- | |||
2024/?wpdmdl=51188&refresh=663b4dc3873b51715162563 | |||
Right Issue | Shares offered by a company to its members strictly in proportion to the | ||
shares already held in respective kinds and classes. | |||
A person who has contributed initial capital in the issuing company or has | |||
the right to appoint majority of the directors on the board of the issuing | |||
company directly or indirectly; | |||
Sponsor | A person who replaces the person referred to above; and | ||
A person or group of persons who has control of the issuing company | |||
whether directly or indirectly. | |||
Page 7
KSB | ||
Offer Document | ||
Pumps | ||
Table of Contents | ||
1. SALIENT FEATURES OF THE RIGHT ISSUE | 9 | |
1.1. | BRIEF TERMS OF THE RIGHT ISSUE | 9 |
1.2. | PRINCIPAL PURPOSE OF THE ISSUE AND FUNDING ARRANGEMENTS | 11 |
1.3. | FINANCIAL EFFECTS ARISING FROM RIGHT ISSUE | 13 |
1.4. | TOTAL EXPENSES TO THE ISSUE | 13 |
1.5. | DETAILS OF UNDERWRITERS | 14 |
1.6. | COMMITMENTS FROM SUBSTANTIAL SHAREHOLDERS/DIRECTORS | 14 |
1.7. | FRACTIONAL SHARES | 14 |
1.8. | IMPORTANT DATES | 14 |
2. SUBSCRIPTION AMOUNT PAYMENT PROCEDURE | 16 | |
3. PROFILES OF THE BOARD OF DIRECTORS OF THE COMPANY AND SPONSORS | 17 | |
3.1. | PROFILE OF THE BOARD OF DIRECTORS OF THE COMPANY | 17 |
3.2 | DIRECTORS DIRECTORSHIP IN OTHER COMPANIES | 19 |
3.3 | PROFILE OF THE SPONSORS | 20 |
4 DETAILS OF THE ISSUER | 20 | |
4.1 | FINANCIAL HIGHLIGHTS OF THE ISSUER FOR THE LAST THREE YEARS | 20 |
4.2 FINANCIAL HIGHLIGHTS OF PRECEDING ONE YEAR OF CONSOLIDATED FINANCIAL
STATEMENTS | 20 | |
4.3 | DETAILS OF ISSUE OF CAPITAL IN PREVIOUS FIVE YEARS | 21 |
4.4 AVERAGE MARKET PRICE OF THE SHARE OF THE ISSUER DURING THE LAST SIX
MONTHS | 21 | ||
4.5 | SHARE CAPITAL AND RELATED MATTERS | 21 | |
5. | RISK FACTORS | 22 | |
5.1 | RISK ASSOCIATED WITH THE RIGHT ISSUE | 22 | |
5.2 | RISK ASSOCIATED WITH ISSUER | 22 | |
6. | LEGAL PROCEEDINGS: | 26 | |
6.1 | OUTSTANDING LEGAL PROCEEDINGS OF THE COMPANY | 26 |
6.2 Any outstanding legal proceeding other than the normal course of business involving the issuer, its sponsors, substantial shareholders, directors and associated companies, over
which the Issuer has control, that could have material impact on the issuer | 28 |
6.3 Action taken by the securities exchange against the issuer or associated listed companies of the issuer during the last three years due to noncompliance of its regulations 28
7. SIGNATORIES TO THE OFFER DOCUMENT | 28 |
Page 8
Offer Document | KSB | ||||
Pumps | |||||
1. SALIENT FEATURES OF THE RIGHT ISSUE
1.1. BRIEF TERMS OF THE RIGHT ISSUE
a) | Description of Issue | Issuance of Right Shares to existing shareholders | ||||
The Company shall issue 17,700,000 (Seventeen Million, | ||||||
Seven Hundred Thousand) ordinary shares, at a price of | ||||||
b) | Size of the proposed Issue | PKR 110/- (Pak Rupees One Hundred and Ten) per | ||||
share, aggregating to PKR 1,947,000,000/- (Pak Rupees | ||||||
One Billion, Nine Hundred Forty-Seven Million). | ||||||
c) | Face Value of the Share | PKR 10/- | ||||
The Right Issue is being carried out at a premium. | ||||||
d) | Basis of determination of price of | Considering the current market price of the Company, | ||||
the right issue | the premium charged over the par value is justified and | |||||
is in line with market practice. | ||||||
Proportion of new issue to existing | Approximately 134.0909 right shares for every 100 | |||||
e) | shares with any condition | ordinary shares held i.e. Approximately 134.0909% of | ||||
applicable thereto | the existing paid-up capital of the Company. | |||||
Date of meeting of Board of | ||||||
f) | Directors (BoD) wherein the right | April 29, 2024 | ||||
issue was approved | ||||||
1. Dr. Sven Baumgarten, Chairman | ||||||
2. Mr. Imran Ghani, Chief Executive Officer | ||||||
3. Mr. Dieter Antonius Pott, Non-Executive Director | ||||||
g) | Name of directors attending the | 4. Ms. Hassan Aziz Bilgrami, Non-Executive Director | ||||
Board Meeting | 5. Ms. Ayesha Aziz, Independent Director | |||||
6. Mr. Asif Malik, Independent Director | ||||||
7. Mr. Shahid Mehmood, Independent Director | ||||||
8. Mr. Asim Rafiq, Nominee NIT | ||||||
The purpose of the Right Issue is to meet the Capital | ||||||
Requirement of the Company to effectively implement its | ||||||
h) | Brief purpose of utilization of right | business with a view to enhance the profitability of the | ||||
issue proceeds | Company. This aligns with the Company's broader strategy to | |||||
fortify its financial position in order to enhance profitability | ||||||
and, consequently, provide greater shareholder return. | ||||||
To manage our company's working capital requirements and | ||||||
Purpose of the Right Issue: | save finance costs. | |||||
In the country's current economic environment, where | ||||||
Details of the main objects for | ||||||
interest rates have increased significantly, funding the | ||||||
i) | raising funds through present right | Company's working capital requirements largely through | ||||
issue. | bank and financial institution through debt is not a feasible or | |||||
prudent option. Consequently, the funds raised through | ||||||
equity to be utilized for working capital purposes is a more | ||||||
prudent business and strategic approach, which will reduce | ||||||
Page 9 |
| Attention: This is an excerpt of the original content. To continue reading it, access the original document here. |