Unilever's parent company buys back more shares to raise stake in Pakistan

[Naveed Yaseen]

Karachi, Oct 21: Unilever Overseas Holdings Limited said on Tuesday that they had acquired 323,548 additional shares in Unilever Pakistan Limited, raising their holdings in the company to 9.68 million shares representing 72.84 per cent of the total paid-up capital, from 70.40 per cent previously. The Unilever Overseas has also accumulated 70.52 per cent of the preference share capital of the company.

Analysts viewed it as rare good news for the country’s stock market, where a foreign investor (if only a holding company) has shown confidence in its Pakistani subsidiary. But there are reasons to be optimistic.

The Unilever Pakistan is one of the highest quoted scrips on the stock exchanges with price tag of Rs2,340 for a 50-rupee share.

The recent waves of equity erosions passed over the Unilever stock, licking almost nothing from the value of Rs2,361 quoted on April 18, the day when the market was caught in the downward spiral.

Shareholdings in Unilever Pakistan, other than those by overseas holding company, are widely dispersed among institutional and individual investors. But much of them are in frozen blocks as the stockholders seldom part with their stake.

The turnover in Unilever stock stood at just about 81,120 million shares in the nine months period of the current calendar year (Jan-Sept) against the company’s issued and paid-up shares of 13.3 million.

On June 30, the Unilever Pakistan reserves amounted to Rs1,746 million and total equity at Rs2,415 million. The balance sheet footing was Rs11 billion.

http://www.dawn.com/2008/10/22/ebr7.htm