Engineering firm Ados Pakistan Ltd is going to delist from the Pakistan Stock Exchange (PSX) on Jan 9 after the bourse accepted its request on Thursday for going private.
Engaged in the supply of oil and gas field–related equipment, Ados grappled with “serious concerns” about its ability to continue its regular operations following low sales and “structural changes” in the energy exploration and production (E&P) industry.
The PSX’s Voluntary Delisting Committee approved in August the minimum buyback price of Rs29 per share. The exchange advised minority shareholders on Tuesday to approach the company’s sponsors if they want to participate in the share buy-back exercise.
The sponsors have already submitted an undertaking to the regulator under which they are bound to purchase the remaining shares held with minority shareholders at Rs29 apiece until Nov 17 next year.
The company’s current stock price is also Rs29 per share.
According to company CEO Zia Akbar Ansari, the sponsors are taking Ados private because they wish to protect the interest of the minority shareholders amid an “extremely uncertain” future.
The state-owned E&P companies stopped buying equipment from Ados after declaring it disqualified “on the basis of experience”. Declining sales and long-term net losses left the company unable to service the licensing and certification costs for its manufacturing licence from the American Petroleum Institute — a prerequisite for doing business with state-owned E&P firms.