KARACHI: Bestway Cement Limited has announced the merger of Mustehkam Cement Limited with Bestway Cement. In a meeting held on Tuesday, the chairman informed the board of Bestway Cement Limited that Mustehkam Cement stands merged with Bestway Cement. Shareholders of Mustehkam Cement, other than Bestway Cement, are entitled to receive shares of Bestway as per the approved swap ratio of 0.66 shares of Bestway in place of every share of Mustehkam, with an allotment of one additional share for every fractional entitlement of 0.5 or more ignoring fractional entitlement of less than 0.5 shares. At the time of amalgamation, there were 129.260 million issued and paid up shares of MCL, of which 127.468 million shares were held by BCL and the remaining shareholders held 1.792 million shares. Bestway Cement Limited is a part of UK’s Bestway Group. In response to successive governments’ efforts to attract foreign investment in the country, Bestway Group has invested heavily in Pakistan. In just over a decade, Bestway’s cement production capacity is set to hit over six million tons per annum, making Bestway the second largest cement producer in the country. To further extend its presence in the cement industry, Bestway decided to bid for 85.29 percent equity of Mustehkam Cement Limited, following an offering by the Privatisation Commission. The company’s $70.0 million bid was accepted in September 2005 and Mustehkam started production in December 2005. Recently, Bestway embarked upon major upgradation and modernisation of Mustehkam. In the initial phase, one of the process lines at Mustehkam is being upgraded to 0.9 million tons per annum at an estimated cost of $50 million. This enhancement is being carried out mainly with the assistance of FL Smidth and will take the total production capacity of Mustehkam to above 1.2 million tons per annum of clinker. Planning is already in progress to upgrade and enhance the remaining production lines. According to AKD Securities’ research, the cement sector has grown phenomenally this year, boosted by strong overseas demand and recovery in domestic demand and prices. The combined profits of cement companies in the first six months of fiscal 2013 almost equalled the combined profits for the entire preceding year. Most analysts have predicted that the profitability of the cement sector will continue to grow in the remaining of the current fiscal year. Moreover, the cement companies’ stocks listed on the KSE are set to post stellar growth of 75 percent in 2013, making the ongoing year the best ever for cement manufacturers.
