Amreli Steels to raise Rs1bn via Direct Share Issuance

October 06, 2025 (MLN): The Board of Directors of Amreli Steels Limited (PSX: ASTL) has approved the issuance of up to 40 million ordinary shares, other than by way of rights issue, at Rs25 per share, including a premium of Rs15 per share, to raise Rs1bn in equity.

The direct issuance, representing up to 13.47% of the existing paid-up capital, will be made to one of the company’s existing sponsors, Mr Shayan Akberali.

The sponsor family has committed to fully subscribing to the new shares, reflecting its continued confidence in the company’s growth prospects.

Mr Akberali, who currently holds 17.09% of the company’s shareholding, has agreed to inject the entire equity amount in cash.

According to the company’s disclosure, Amreli Steels had initially planned to raise funds through a rights issue.

However, the Securities and Exchange Commission of Pakistan (SECP) informed the company that, under the Companies (Further Issue of Shares) Regulations, 2020, it is not permitted to undertake a rights issue due to the ongoing restructuring process and the resultant report issued by the Credit Information Bureau of the State Bank of Pakistan.

Consequently, the company opted for a direct issuance to fulfil the equity injection requirements stipulated by lending banks and financial institutions under the restructuring terms.

The proceeds from the issuance will be utilized to strengthen working capital and support credit restructuring. The company said the equity injection would enhance operational liquidity, improve cash flow generation, and ensure stable production capacity utilization.

This move, Amreli added, will help safeguard the interests of all stakeholders and prove particularly beneficial to minority shareholders by reinforcing the company’s financial stability.

The direct issuance is priced at Rs25 per share, higher than the three-month average market price of Rs23.48 and the latest closing price of Rs24.88 as of October 2, 2025.

The breakup value per share, based on audited financials for the year ended June 30, 2025, stands at Rs35.18.

The consent of Mr Shayan Akberali has been obtained for the subscription, and the new shares will rank pari passu in all respects with the company’s existing ordinary shares.

The proposed issuance remains subject to necessary corporate and regulatory approvals, including shareholder consent and clearance from the SECP under Section 83(1)(b) of the Companies Act, 2017, and the Companies (Further Issue of Shares) Regulations, 2020.

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