Explainer: What Greentree’s tender offer means for TRG Pakistan shareholders

Greentree Holdings Limited (GHL) - an international investment holding firm of TRG International - has offered to purchase additional stakes in TRG Pakistan through a tender offer at the Pakistan Stock Exchange (PSX).

The offer provides an opportunity for shareholders to sell their stakes in TRG Pakistan – a venture capital firm - at an offered price of Rs75 per share, which is 35% higher compared to the pre-tender offer share price at the bourse.

Greentree has offered to purchase an additional 35.147% (191.69 million) stake in TRG Pakistan at Rs75 per share from those shareholders whose names appeared in the company’s book on February 23, 2025.

Those shareholders who bought TRG Pakistan’s shares after February 19, 2025, are ineligible to participate in the tender offer.

TRG International has recently sold a part of its shareholding in one of its assets i.e. Ibex worth over $52 million. It would like to share the income with TRG Pakistan shareholders by inviting the shareholders to sell their holdings by participating in the tender offer.

Share purchase of TRG Pakistan: Greentree Holdings says will bring in $50m foreign exchange inflows

To do so, Greentree Holdings has launched a tender offer to purchase TRG Pakistan shares at a premium of 35% compared to its price closed at Rs55.59/per share a day before it expressed interest in purchasing the shares on December 23, 2024.

The tender offers a premium of Rs13.89/per share even when compared to the February 19, 2025 closing price at Rs61.11/per share at PSX.

Greentree Holdings already holds substantial shares of TRG Pakistan at approximately 29.9%.

The laws require the substantial shareholder to buy at least 50% of the remaining 70% of shares i.e. 34.147% (or 191.69 million shares) including from retail and minority shareholders at a premium price compared to the pre-tender market price, offering them an opportunity to book a handsome capital gain.

In a notice issued to the PSX on Monday, AKD Securities, the lead manager to the tender offer, informed that the “offer letters have been dispatched along with relevant instructions and letters of acceptance to all shareholders of the TRG Pakistan Limited, except for the acquirer”.

“The acceptance period as per the revised timelines is from March 25, 2025, to April 4, 202,5 between 9am to 5pm, wherein tenders will be accepted during business hours on all working days,” read the notice.

Greentree has already deposited the purchasing amount worth around $52 million (Rs14.4 billion) to the authorities concerned through an escrow account.

A court stay on the Greentree Holdings tender was vacated after the Islamabad High Court dismissed a shareholder petition seeking to restrain Greentree from purchasing shares of TRG Pakistan.

According to an analyst, the tender offer is a golden opportunity for TRG Pakistan’s shareholders to sell their holdings at a premium price amid a likely decline in TRG Pakistan’s share price after the purchase of new shares through the tender offer.

The analyst predicted that the share price might remain below the tender offer price for some time.

There is a risk of a lull in TRG Pakistan’s share price, but an increase in its price cannot be ruled out in the long run. “It all depends on shareholders’ power on how long they may retain the stocks,” the analyst added.

The intended purchase of new shareholding at 35.147% would take up Greentree’s total shareholding to around 65%. It already holds 30% (or 162.01 million shares) at present.

TRG Pakistan Limited will continue to operate as a listed company after the proposed acquisition, running its business operations and investments in the ordinary course, according to an early notice by AKD Securities.