CCP greenlights SCL merger with JKSM

July 09, 2024 (MLN): The Competition Commission of Pakistan (CCP) has approved a Scheme of Arrangement for the merger of Shamim & Company (Pvt.) Ltd with JK Sugar Mills (Pvt.) Ltd, said a press release issued on Tuesday.

JKSM is a private limited company with the business of production and sale of sugar or related products in Pakistan.

JKSM primarily produces refined white sugar, along with three by-products namely, molasses, bagasse, and mud. SCL, since 1967 is into the business of manufacturing and distribution of PepsiCo products across Pakistan.

The phase-I competition assessment by the CCP identified two relevant markets namely, 'Sugar and by-products' and ‘Non-alcoholic beverages’.

As per the scheme of arrangement, the transaction involves merger of SCL with in JKSM.

Moreover post-transaction, SCL would be dissolved and JKSM would be the surviving entity where the board of directors of JKSM will continue to serve as directors of the merged entity.

The assessment further confirmed that post-transaction, SCL’s market shares in ‘Non-alcoholic beverages’ will remain unchanged posing no threat for creation of dominance by JKSM.

The proposed transaction would result in benefits in saving costs through streamlining procedures and reduction in overhead and working expenses.

There will be an increase in efficiency after the unified control. Improvement in the operations shall ultimately benefit shareholders, employees, customers and others generally.

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