KARACHI, Aug 5: M.F.M.Y Industries — a publicly traded company on the textile spinning sector — proposes to pay Rs11.50 for each share held by the minority shareholders and seek stock market de-listing.

Two major shareholders in the company — Aziz Usman and Zafar Usman — who between them hold about 97 per cent of the outstanding stock, had made the first buy-back proposal as far back as in December last. But the repurchase price then quoted was Rs7 per share. It quite looks like the stock exchange has managed to broker it up by 62 per cent to Rs11.50.

On why it wanted to seek delisting, the company had told the Karachi Stock Exchange that it had accumulated losses of Rs193.5 million on its balance sheet, which had wiped out the paid-up capital of Rs46.2 million and general reserves of Rs31 million.

The company therefore stood in the net negative equity of Rs116.3 million at September 30, 2001.

In spite of the heavy accumulated losses, the company had declared cash dividend at 10 per cent for financial year 2001. In a statement issued earlier, the company had stated that it had made a small profit last year, but things were less cheerful after the September 11, as orders started to be cancelled due to the global recession.

The company was incorporated back in 1950; its spinning plant was based on old technology, which, with the passage of time had lost its efficiency.

The company has a total of 4.62 million outstanding shares. Ninety-seven per cent of those held by sponsors, the thee per cent with the general public would work out to 0.139 million shares.

At Rs11.50, the two major investors in the company would have to pay something of Rs1.6 million to the minority shareholders if all of them surrender their holdings.

The company notified on Monday that the share purchase offer would be valid from Aug 1 to September 29, both days inclusive. Stock brokers, Akbarally Cassim & Sons have been appointed the authorized purchase agent.