Dutch company to acquire Engro Foods with an investment of around $460 million

[Sipahi]

People don't seem to actually understand how this deal works. The Dutch are buying a majority stake, but Engro foods will still have Pakistani shareholders, mainly Engro Corporation.

You heard that right, Engro Corporation. Engro Foods is merely an arm of Engro Corporation as a whole, and it STILL has a stake in Engro Foods.

https://en.m.wikipedia.org/wiki/Engro_Corporation

My point is, you guys need to stop being so cynical and cheer up. This is a good move.

@AUz @Thəorətic Muslim @mshahid @RazorMC @TheNoob @Samlee @Imtiaz_Sarwar @NP-complete @S.Y.A @haviZsultan @Zibago @Devil Soul

I am not being cynical, I am up for the sale, and I am asking that setup a new company with 250 Million, it will generate competition and job opportunities.

 

[Samlee]

People don't seem to actually understand how this deal works. The Dutch are buying a majority stake, but Engro foods will still have Pakistani shareholders, mainly Engro Corporation.

You heard that right, Engro Corporation. Engro Foods is merely an arm of Engro Corporation as a whole, and it STILL has a stake in Engro Foods.

https://en.m.wikipedia.org/wiki/Engro_Corporation

My point is, you guys need to stop being so cynical and cheer up. This is a good move.

@AUz @Thəorətic Muslim @mshahid @RazorMC @TheNoob @Samlee @Imtiaz_Sarwar @NP-complete @S.Y.A @haviZsultan @Zibago @Devil Soul

Read My Post#9 Gentleman Where Have I Been Cynical?????

 

[That Guy]

Read My Post#9 Gentleman Where Have I Been Cynical?????

I should have clarified, I tagged you, because you seemed to be the only other person who knew what was going on.

 

[S.Y.A]

People don't seem to actually understand how this deal works. The Dutch are buying a majority stake, but Engro foods will still have Pakistani shareholders, mainly Engro Corporation.

You heard that right, Engro Corporation. Engro Foods is merely an arm of Engro Corporation as a whole, and it STILL has a stake in Engro Foods.

https://en.m.wikipedia.org/wiki/Engro_Corporation

My point is, you guys need to stop being so cynical and cheer up. This is a good move.

@AUz @Thəorətic Muslim @mshahid @RazorMC @TheNoob @Samlee @Imtiaz_Sarwar @NP-complete @S.Y.A @haviZsultan @Zibago @Devil Soul

The bold part says it all. whether dawood group holds a share or not, they will not control Engro foods. Like we were discussing, instead of turning it into something bigger, they just took the load off their shoulders and sold it to the Dutch.

 

[Samlee]

I should have clarified, I tagged you, because you seemed to be the only other person who knew what was going on.

Ok Thanx For Clarification This Seems to Be Repeat Of History In 1994 When Nestle Bought Control of Milkpak From Wazir Ali Group.

Engro Is No Doubt A World Class Company Headed by Long Established and Well Respected Business House(Dawoods)
With World Class Brands Like Olpers(Back in 2007-08 When Olpers Started Advertising,The Ad Was So Good I Actually Thought It Was Some Foreign Brand Coming to Pakistan,It Is Nice To Know We Can Come Up With Such Great Branding)


If We Can Create Companies and Brands Of This Quality In All Sectors No Doubt Foreign Investors Will Always Be Interested

 

[SBD-3]

Personally as one of the few and only Pakistani companies that have been successful I do not want Engro foods to be taken by foreigners. Everyone protects their businesses. I remember in Canada what a problem it was for Wind and Egyptian companies to come in when there was no harm. The logic was canadians losing their jobs.

I think a Pakistani giant company should emerge from Pakistan like Nokia emerged from Finland.This takeover will be a punch to Pakistani entrepreneurs and I hope the deal doesn't go through

A)They need money to set up a couple of power plants in Sindh which offer 20% fixed dollar IRR (Much better than food processing which is getting saturated)
B)They aren't selling everything, they are just divesting a portion of their holdings in EFoods and Efert kind of re-balancing their corporate portfolio.

Are the Dutch buying Engro or investing in it?

Buying shares means investing....Its not a rocket science.

 

[That Guy]

The bold part says it all. whether dawood group holds a share or not, they will not control Engro foods. Like we were discussing, instead of turning it into something bigger, they just took the load off their shoulders and sold it to the Dutch.

That's not the same thing as selling the company to the dutch. This is not how buying stock works. This just means that the Dutch get the most voting rights in the company, and cannot just shut the company down. 51% gives them the power to put their own board of directors in power, and gain the most dividend per share, but that's really about it.

 

[Thəorətic Muslim]

Buying shares means investing....Its not a rocket science.

The article goes back and forth over "investing" and "buying out".

 

[T-123456]

Its a win-win situation. Engro is the most profitable private-sector corporation in Pakistan. Dutch company is buying a golden hen. And european food companies are food experts. They know the chemistry of food like no one else. I can wager the taste of OMORE icecream will become much much better.

You can expect it to be more expensive.

 

[SBD-3]

The article goes back and forth over "investing" and "buying out".

That's why financial journalism has emerged as a separate field.
For example, Railways has started providing insurance coverage of 500K to the travelers for a premium of 5Rs per ticket. Here's how an ordinary journalist writes it
http://www.express.pk/story/464391/

 

[Imtiaz_Sarwar]

People don't seem to actually understand how this deal works. The Dutch are buying a majority stake, but Engro foods will still have Pakistani shareholders, mainly Engro Corporation.

You heard that right, Engro Corporation. Engro Foods is merely an arm of Engro Corporation as a whole, and it STILL has a stake in Engro Foods.

Engro Corporation - Wikipedia, the free encyclopedia

My point is, you guys need to stop being so cynical and cheer up. This is a good move.

@AUz @Thəorətic Muslim @mshahid @RazorMC @TheNoob @Samlee @Imtiaz_Sarwar @NP-complete @S.Y.A @haviZsultan @Zibago @Devil Soul

Thank you for tagging me. I am not being cynical. I am full of optimism. I see this as a positive development for our country. We should thank Engro foods for building up a world class company which a European multinational has considered an asset worth buying. I assume that the board of directors at Engro to be intelligent and they must have plenty of ideas regarding profitable ventures where they can invest their money.
I won't be surprised if a few years from now we hear that Engro is selling another profitable venture to another multinational after making a large profit. It is also possible that they may buy a profitable company from someone else.

 

[S.Y.A]

That's not the same thing as selling the company to the dutch. This is not how buying stock works. This just means that the Dutch get the most voting rights in the company, and cannot just shut the company down. 51% gives them the power to put their own board of directors in power, and gain the most dividend per share, but that's really about it.

like I said, they will control the future of the company.

 

[SBD-3]

A lot of foreign players including funds have been buying around for a while.
For example, Kingsway Fund (HK based frontier market fund) has been purchasing HUM network's shares for quite a while now
http://psx.com.pk/newsattachment/075563.pdf
http://psx.com.pk/newsattachment/073556.pdf
http://psx.com.pk/newsattachment/075563.pdf

 

[AsifIjaz]

Engro is slowly but gradually restructuring....
it has divested its shares from PVC/VCM plant etc... and has given away its majority share holding of Foods business.
It has restructured its Rice plant and related grain business.... it is entering pesticide business (an excellent move... Fertilizer + seed + pesticide).
with the LNG coming into the pipeline the enven plant will start giving more profit and the area of focus will be thar coal plant where SECM has given away sizeable shares to house of habib, hubco and PSO. all in all.... expect something big from engro in next 3/4 years. the foundation is being laid quiet nicely