Pakistan cement producer Bestway Cement has invested PKR1.25bn (US$14,680) into the company’s subsidiary, Mustehkam Cement Limited, through purchase of right shares, according to a release published by the Karachi Stock Exchange on Tuesday. An extraordinary general meeting of Bestway Cement approved the move to subscribe to the shares at a price of PKR15/share, compared with a six-month average price of PKR13.07 /share.
After the latest capital injection, Bestway Group’s stake in Mustehkam Cement stands at 95.03 per cent of the total paid-up capital. The group purchased Mustehkam Cement back in September 2005 after a successful bid of US$70m for an 85.29 per cent stake. The plant had been dormant since 1999, however it became operational roughly a month after the deal, in November 2005.
The plant is located in Haripur, Khyber-Pakhtunkhwa, and has an installed capacity of about 0.6Mta. “The capital inflow is part of a series of measures being carried out since the acquisition of the plant to improve efficiency and productivity,” explained InvestCap Head of Research Khurrum Shehzad. Bestway intends to enhance capacity to 1.2Mta, while also upgrading some of the existing production lines at the facility.