Karachi: MLCF and PIOC have announced board meetings set for September 2, 2026, prompting speculation about a possible merger between the two cement companies. Industry analysts suggest that the meetings could lead to discussions on a proposed merger, given their synchronized scheduling.

According to JS Global, the analysis anticipates a potential swap ratio in the range of 2.1 to 2.6 MLCF shares for every PIOC share. This estimate is grounded in the valuation framework outlined by the Securities and Exchange Commission of Pakistan (SECP) Guidelines for Mergers and Amalgamations, which recommend using various valuation methodologies to determine a fair share exchange ratio. The guidelines suggest that a recognized valuation expert should assess the financial positions of both companies to derive this ratio, ideally using an average derived from methodologies such as Net Worth/Break-up Value, Market Value, Future Earning Capacity/DCF, and Comparable Transactions.

The press release cites a precedent with the Fauji Group's merger of Askari Cement Limited with Fauji Cement Company Limited, which was executed through a share-swap arrangement. In that case, EY Ford Rhodes conducted a valuation using the Income, Market, and Cost Approaches, resulting in a swap ratio range of 4.6 to 5.6 FCCL shares for each ACL share, with an average swap ratio of 5.0.

JS Global's analysis for MLCF and PIOC applies the SECP's four methodologies, excluding PIOC's consolidated financials. The analysis suggests an average swap ratio range of 2.1 to 2.6 MLCF shares for every PIOC share, potentially guiding the upcoming discussions at the scheduled board meetings.