Thermal assets portfolio: Engro now evaluating conventional sale option

Engro Corporation Limited will not restructure its thermal energy assets under a separate wholly-owned holding company and is now evaluating to execute the proposed divestment of its portfolio held via Engro Elengy Limited through a conventional sale of shares process.

The company shared the development in a notice to the Pakistan Stock Exchange (PSX) on Monday.

“Engro Corporation would like to inform its shareholders that the earlier disclosed plans for restructuring and/or reorganization of its thermal energy assets under a separate wholly-owned holding company are not being pursued any further,” read the statement.

The restructuring of thermal assets was part of Engro’s efforts to streamline and optimise capital and resource allocation.

On discussions between Engro Corporation and Liberty Mills Limited, along with other parties acting in concert, Engro informed its shareholders that “it is now being evaluated to execute the proposed divestment of the company’s thermal energy asset portfolio held via Engro Energy Limited through a conventional sale of shares process”.

“The consummation of the proposed transaction remains subject to successful negotiations, execution of definitive agreements, receipt of corporate/regulatory approvals and lender consents,” it added.

Back in October, Engro told its shareholders that it is looking to form a “strategic equity partnership” with Liberty Power Tech Limited over its thermal energy assets.

As per Engro’s latest financial results, the company posted a Profit After Tax (PAT) of Rs66.05 billion for 2023 – before the remeasurement of thermal assets – with an increase of 43% as compared to Rs46.1 billion recorded in the same period of the previous year.

The profit translates into Earnings per Share (EPS) of Rs63.01 in 2023, in comparison to an EPS of Rs42.23 recorded in the same period last year.