KARACHI, Oct 11: Three companies conveyed to the Karachi Stock Exchange their willingness to buy-back shares held by the minority shareholders at prices negotiated with the Exchange.

The KSE announced on Thursday that Benz Industries Limited; Pakpanther Spinning Mills Limited and Farooq Habib Textile Mills Limited, which had earlier opted to repurchase all of the shares held by the small shareholders and seek stock market de-listing, had agreed to the prices negotiated with the sub-committee of the Exchange.

Benz Industries Limited had accepted the buy-back price of Rs20 per share; Pakpanther said it would repay Rs14.50 per share and Farooq Habib Textile Mills agreed to the repurchase price of Rs16.25 for each share that the small shareholders return to the company.

Like in several of the previous such cases, the stock exchange has to be conceded to have brokered a good bargain for the small shareholders. The 10-rupee share in Pakpanther is quoted at Re 1; the company holds Rs88 million in paid-up capital and it paid cash dividend at 20 per cent for financial year 2000. Pakpanther had offered the buy-back price of Rs10.

The other company — also a textile spinning mill — Farooq Habib Textile mills is quoted at Rs4.85 with 11.4 million outstanding shares; the company had also declared 7.5 per cent cash dividend for 2000 after possibly several blank years.

Benz Industries — the producer of once popular soft drink — has since long fallen upon bad times. Deep in debts and deficit, the company has not been able to pay dividend for numerous years and the share in the company stands quoted at Rs9 on the “defaulters’ counter” of the stock exchange. The company has a tiny capital of Rs4.5 million. Interestingly, if even 10 per cent of the equity is held by the small shareholders and all of them can find and produce the long forgotten share certificates, the company would have to pay back no more than a million rupees.

While the Initial Public Offerings at the stock exchanges have slowed to its lowest point in at least the last four years, companies have been scrambling to buy-back minority shareholders’ stake and seek stock market de-listing. Already more than two dozen listed companies have bade adieu to the bourses.

A few of the most attractive repurchase offers to the small shareholders came from the foreign majority shareholders in Novartis Pakistan (formerly Ciba-Geigy) and Novartis Pharma (formerly Sandoz Pakistan). Against the then stock market prices of around Rs40 for a 10-rupee share, the principals picked up all shares held by the small shareholders, at Rs68 per share.

Gillette Pakistan was another multinational to pull out through the buy-back of minority shares at Rs46.20, a share. And Philips Pakistan has declared that it would buy-back all shares surrendered until May 7, 2002, at Rs75 a share.