The Board of Directors of the Pakistan Stock Exchange (PSX) has decided to form a wholly-owned subsidiary namely PropCo to demerge real estate from its regular operations, announced PSX in a market notice.
The decision was made at its meeting held on June 29, 2021.
The bourse, in a statement on Wednesday, stated: “In continuation to PSX’s earlier announcements dated February 23, 2018, and August 28, 2019, with respect to in-principle approval of PSX’s Board of Directors regarding the proposed demerger of PSX’s real estate from its operations, the Board has resolved to form a wholly-owned subsidiary of PSX for the purpose of demerger, instead of creating a sister concern owned by PSX’s shareholders.”
In 2018, the PSX board approved the concept of demerger of real state from its operations which would result in the creation of a separate entity, the shares of which would be issued to the existing shareholders of the Exchange. The board then mandated the management to hire the services of investment bankers and legal counsel to advise in the process.
“Accordingly, PSX’s immovable properties and related arrangements will be transferred into a wholly owned subsidiary (PropCo) against the issuance of shares of PropCo in favour of PSX through a Scheme of Arrangement under the relevant provisions of Companies Act, 2017,” it added.