Maple Leaf Cement to acquire majority stake in Pioneer Cement for $270.5mn

Maple Leaf Cement Factory Limited (MLCF) has launched a public offer to acquire up to 11.72% of Pioneer Cement Limited (PIOC) at Rs478.43 per share, following a prior agreement to purchase a 58.03% stake at the same rate.

The combined transaction, representing 69.75% of PIOC’s shares, amounts to Rs75.8 billion ($270.5 million), according to filings submitted to the Pakistan Stock Exchange (PSX) on Thursday.

The move will give MLCF management control of Pioneer Cement.

“MLCF currently owns 17,321,046 shares constituting 7.63% of the issued and paid-up ordinary shares capital of PIOC of the face value of Rs10 each.

“Maple Leaf Capital Limited (MLCL), an associated company of MLCF, currently owns 24,609,001 shares constituting 10.83% of the issued and paid-up ordinary shares capital of PIOC of the face value of Rs. 10 each. Waleed Tariq Saigol, a director in MLCF, currently owns 152,000, constituting 0.07% of the issued and paid-up ordinary shares capital of PIOC of the face value of Rs. 10 each.

“The combined shareholding of MLCF, MLCL and Waleed Tariq Saigol stands at 42,082,047 ordinary shares of the face value of Rs10 each, constituting 18.53% of the ordinary issued and paid-up capital of PIOC,” read the document.

After the acquisition, MLCF’s total shareholding in PIOC would increase to 88.28%.

MLCF is a flagship company of the Kohinoor Maple Leaf Group, a well-established Pakistani conglomerate with interests in textiles, cement, capital markets, and healthcare. MLCF operates Pakistan’s largest single-site cement facility, comprising four grey-cement production lines and one white-cement line, with a total installed clinker capacity of 7.8 million tons per annum.

Maple Leaf plans to buy majority stake in Pioneer Cement

Meanwhile, Pioneer Cement Limited was set up as a public limited company in 1986. With its plants located in Punjab, the company has three production lines where it manufactures and sells cement. It began its production operation with a capacity of 2000 tons per day. The company also made investments in a 12MW Waste Heat Recovery Power Plant and a 24MW coal power plant.

“The acquisition is expected to generate significant strategic and economic efficiencies,” said MLCF.

Upon completion of the acquisition, the combined market share of MLCF and PIOC is projected to be approximately 15.5%, positioning the group as the third largest player in Pakistan’s cement sector.

“The enhanced scale resulting from the acquisition is anticipated to deliver efficiencies through operational synergies, cost optimisation, and an expanded market presence, enabling the provision of high-quality products to a broader customer base,” MLCF said.

The acquirer added that PIOC would continue its operations in the ordinary course of business and operate as a listed entity.