Maple Leaf Cement Factory (MLCF) and Pioneer Cement Ltd (PIOC) have formally announced a proposed amalgamation via share swap, with initial details disclosed on the Pakistan Stock Exchange (PSX) and analysed in a report by AHL Research Ltd.
Under the scheme, PIOC shareholders will receive 2.65 MLCF shares for every 1 PIOC share. MLCF already owns 77.38 per cent of PIOC (approximately 175.8 million shares), while minority shareholders hold 22.62 per cent (51.4 million shares). To complete the transaction, MLCF will issue approximately 136.17?million new shares to eligible PIOC shareholders.
The merger, effective 1 July 2026, is subject to shareholder, regulatory, and Lahore High Court approvals. Once finalised, PIOC’s operations will be consolidated into MLCF, boosting MLCF’s total cement production capacity to 13.13Mt. This will give MLCF a 15 per cent market share, positioning it as the third-largest cement producer in Pakistan.
The proposed exchange ratio implies a PIOC valuation of USD42.35 per ton EV. Based on FY27E earnings per share (EPS) of PKR16.20 (US$0.05) and a post-transaction share count of 1.184bn, the new issuance is expected to dilute MLCF’s EPS by 11.5 per cent.
Despite the dilution, AHL Research has maintained a “BUY” recommendation on MLCF, citing attractive forward returns and highlighting the company’s strengthened market position following the merger.
This development marks a significant consolidation in Pakistan’s cement industry, reinforcing MLCF’s ambition to expand scale and competitiveness.
By Abdul Rab Siddiqi, Pakistan
