SHC grants stay for two weeks in BIPL Case

March 07, 2023 (MLN): Sindh High Court (SHC) has granted a stay (an ad-interim injunction), as requested by the plaintiffs, in the case of BankIslami Pakistan Ltd. (BIPL) sale until the next date, which is scheduled for two weeks from now.

The court will consider the point raised by the counsel for plaintiffs in light of the regulations and the prohibition of acquiring shares by a single group.

SHC has issued a notice to the defendants in a case concerning the acquisition of shares in a bank. The notice was issued after the learned counsel for plaintiffs highlighted the Prudential Regulations and the requirements that must be met before the acquisition of a bank's shares.

According to the council, the acquisition of shares by one group is prohibited under the law.

This development is significant as it highlights the importance of complying with the regulations before acquiring shares in a bank.

It also sheds light on the consequences of not adhering to these regulations, which can result in legal action being taken against the parties involved.

The case will be closely watched by stakeholders in the banking industry and is expected to set a precedent for future cases concerning the acquisition of shares in banks.

To note, JS Group, a prominent Pakistani conglomerate, has come under fire for alleged discriminatory behavior towards minority shareholders of BIPL in a recent transaction that appears to have some anomalies.

The transaction in question involves the sale of 21.26% of BIPL shares by Jahangir Siddiqui & Co Ltd (JSCL) to JS Bank Ltd (JSBL). On Feb 16th, announced it would sell BIPL shares to the latter, subject to regulatory approvals and shareholder consent.

It mentioned that BIPL shares shall be sold against consideration of new 266,747,496 shares of JSBL (1.1318 shares of JSBL for every BIPL stock), as per a valuation carried out by an independent evaluator.

 Copyright Mettis Link News