Chakwal Spinning’s merger with Khazana falls apart

October 24, 2024 (MLN): Chakwal Spinning Mills Limited (CWSM)'s initial Memorandum of Understanding (MOU) with Khazana Enterprises (Private) Limited (KEPL), signed on January 2, 2024, for a possible merger or acquisition, has failed to materialize, the company's filing on PSX revealed. 

Despite extending the MOU twice, a formal agreement could not be reached. The deal officially lapsed on May 31, 2024, after months of due diligence and negotiation.

Following the MOU's expiration, CWSM appointed Optimus Capital Management Limited as its financial advisor to secure funds for launching its own cloud computing business. On August 15, 2024, a term sheet was signed with PNO Capital Limited, securing a PKR 7.284 billion commitment.

However, the Securities and Exchange Commission of Pakistan (SECP) rejected the proposed business name, "Quantum Cloud & AI Technologies," citing uncertainties due to the expired MOU and PNO’s withdrawal.

Despite these setbacks, CWSM’s management remains determined to pursue its IT transformation, vowing to work tirelessly in the shareholders' best interest.

The company has pledged to keep market participants informed of any further developments through updates on the Pakistan Stock Exchange (PSX).

Copyright Mettis Link News