KARACHI, Nov 27: The Sindh High Court has restrained the State Bank of Pakistan from finalising the merger plan of the Pakistan Industrial Credit and Investment Corporation (Picic) and its subsidiary Picic Commercial Bank into the NIB Bank Limited pending its decision on an application against the scheme.

A Picic shareholder moved an application in his suit challenging the amalgamation scheme. He submitted through Advocate Abid S. Zuberi that an extraordinary general meeting of the company’s shareholders was convened on Nov 26 for considering the scheme without complying with the relevant statutory provisions.

Swap ratio of shares, the applicant Mohammad Haroon’s counsel contended before Justice Nadeem Azhar Siddiqui, has not been disclosed to the shareholders and the entire scheme has been drawn up by an interested party instead of an independent chartered accountant. No details in terms of Section 160 (i) (b) of the Companies Ordinance or directions by the Securities and Exchange Commission of Pakistan (SECP) have otherwise been furnished to the participants of the meeting.

He said the plaintiff had no remedy except to approach the court to protect his interests.

Appearing for defendants, Advocate Dr Farogh Naseem maintained that the notice of the impugned extraordinary meeting was published in a business daily on Oct 30 and the plaintiff had approached the court very late.

Under Section 48 (ii) of the Banking Companies Ordinance, the plaintiff had a remedy and could raise his objections at the meeting and could also approach the SECP for correct valuation of his shares. The court observed that it was difficult to give any finding on merits at this stage.

The Picic may proceed with the scheduled extraordinary meeting subject to the outcome of the injunction application. The State Bank may also proceed with the matter but may not finalise the scheme of amalgamation till its decision on the application. Further hearing was adjourned to Dec 5.