KARACHI: Wyeth Pakistan Limited on Monday disclosed the minimum purchase share for the buyback transactions with the minority shareholders at Rs1,284.18 per share.
The pharmaceutical firm had first informed the Pakistan Stock Exchange (PSX) on May 18, 2021 that the majority shareholder in the company Wyeth LLC, USA intended to repurchase all outstanding shares presently listed at the bourse, barring those held by Wyeth Holdings Corporation, being the wholly owned subsidiary of Wyeth LLC.
The company intends to repurchase 396,579 shares comprising 27.90 per cent of the capital of the company and seek voluntary delisting from the PSX.
In the earlier dispatch to the PSX on May 18, Wyeth had not disclosed the repurchase price.
Following the disclosure of information, the stock price of Wyeth Pakistan suffered a steep fall of Rs15.30 to hit its lower lock and close at Rs1,866.19 per share at the trading on Monday.
Wyeth Pakistan said, “The proposed minimum purchase price had been determined in accordance with the requirements of the regulation 5.14.1 of PSX Rule Book”. However, going by the practice adopted in previous repurchase transactions, the buyback price of the Wyeth stock must not be understood to be final.
The relevant committee of the PSX would hold several rounds of talks with the Company officials to broker a price per share acceptable to both buyers and sellers. In the dispatch to the PSX, Wyeth Pakistan also conveyed the reasons for the parent company to call back the minority stock and seek de-listing.
The reasons mentioned included: The sponsors Wyeth LLC USA which is a subsidiary of Pfizer Inc., intended to obtain full ownership of the Company (together with its affiliate) by purchasing all outstanding shares held by minority shareholders barring those held by Wyeth Holdings LLC (being an affiliate of Wyeth LLC USA) in order to increase ownership and delisting of the company from PSX; secondly, the company previously owned a manufacturing plant which was divested in 2017.
“The company is now engaged in the import and distribution of imported products and has no new product pipeline,” it said.
Wyeth further stated that the liquidity in the share of the company was relatively low, with an average daily traded volume of approximately only 688 shares. Finally, the company’s net sales had continued to decline over the past four years at a CAGR (2016-2020) of 24pc and the company had reported net losses in 2018 and 2020.
Published in Dawn, August 17th, 2021