arif habib investment management limited

57 Pages·2012·1.04 MB·English

ADVICE FOR INVESTORS
INVESTORS ARE ADVISED IN THEIR OWN INTEREST TOCAREFULLYREAD THE
CONTENTS OF THIS OFFER FOR SALE DOCUMENT, PARTICULARLY THERISK FACTORS
GIVEN ATPARA4.9, BEFORE MAKING ANY INVESTMENT DECISION.
SUBMISSION OF FICTITIOUS AND MULTIPLEAPPLICATIONS(MORE THAN ONE
APPLICATIONS IN THE NAME OF SAME PERSON)IS PROHIBITED AND SUCH
APPLICATIONS’ MONEY IS LIABLE TO CONFISCATION UNDER SECTION 18A OF THE
SECURITIES AND EXCHANGE ORDINANCE, 1969
ARIF HABIB INVESTMENT MANAGEMENT LIMITED
OFFER FOR SALE OF SHARES
PRESENT OFFER CONSISTSOF7,500,000ORDINARY SHARES(25% OF PAID-UP
CAPITAL) AT AN OFFER PRICE OF PKR125/-PER SHARE (INCLUDING A
PREMIUM OF PKR115/-PER SHARE)OUT OF TOTAL PAID-UP CAPITAL OF PKR
300 MILLION DIVIDED INTO 30 MILLION ORDINARY SHARES OF PKR10/-EACH
THIS IS NOT A PROSPECTUS BYARIF HABIB INVESTMENT MANAGEMENT
LIMITED, BUT AN OFFER FOR SALE BY SOME OF THEEXISTING
SHAREHOLDERS, OUT OFTHEIRSHAREHOLDING IN ARIF HABIB
INVESTMENT MANAGEMENTLIMITED
The subscription list will Insha’Allah open at the commencement of banking hours
on 18th July, 2008 and will close on 19th July, 2008 at the close of banking hours
Advisor & Arranger
Underwriters
Allied Bank Limited
First Dawood Investment Bank Limited
AHM Securities (Pvt.) Limited
Habib Bank Limited
Intermarket Securities (Pvt.) Limited
The date of publication of this Offer for Sale Document is
30th June 208
Offer for Saleof Ordinary Shares
Arif Habib Investment Management Limited
GLOSSARY OF TECHNICAL TERMSAND ABBREVIATIONS
AHSL Arif Habib Securities Limited
CDA Central Depositories Act, 1997
CDC The Central Depository Company of Pakistan Limited
CDS Central Depository System
CFS Continuous Funding System
CNIC Computerized National Identity Card
The Commission / SECP The Securities & Exchange Commission of Pakistan
TheCompany / AHIML Arif Habib Investment Management Limited
CVT Capital Value Tax
EPS Earnings Per Share
GOP Government of Pakistan
OFFER Offer for Sale of 7,500,000 shares of face value of PKR 10/- each at an
offer price of PKR 125/- per share at a premium of PKR 115/- per
share of Arif Habib Investment Management Limited, by some of the
shareholders out of their shareholdings
OFFERORS Mr. Arif Habib, Mr. Nasim Beg, Arif Habib Securities Limited, and
AHIML Employees’Stock Beneficial Ownership Trust
OFSD Offer For Sale Document
ITO Income Tax Ordinance, 2001
NP Margin Net Profit Margin
Ordinance The Companies Ordinance, 1984
PACRA Pakistan Credit Rating Agency
SBP The State Bank of Pakistan
Stock Exchange / KSE The Karachi Stock Exchange (Guarantee) Limited
TFC Term Finance Certificates
WHT Withholding Tax
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited
TABLE OF CONTENTS
Part No.
PageNo.
1 APPROVALS AND LISTING AT THE STOCK EXCHANGE......................................................1
2 SHARE CAPITAL AND RELATED MATTERS...............................................................................3
3 UNDERWRITING, COMMISSIONS, BROKERAGE, AND OTHER EXPENSES...................10
4 THE COMPANY AND PROSPECTS................................................................................................12
5 FINANCIAL INFORMATION...........................................................................................................20
6 MANAGEMENT AND RELATED MATTERS................................................................................29
7 MISCELLANEOUS................................................................................................................................34
8 APPLICATION AND TRANSFER INSTRUCTIONS...................................................................38
9 SIGNATORIES TO THE OFFER FOR SALE DOCUMENT........................................................42
10 MEMORANDUM OF ASSOCIATION.............................................................................................43
11. APPLICATION FORMS
Offer for Saleof Ordinary Shares
Arif Habib Investment Management Limited
PART 1
1 APPROVALS AND LISTINGATTHE STOCK EXCHANGE
1.1 APPROVAL OF THE SECURITIES & EXCHANGE COMMISSION OF PAKISTAN
The approval of the Securities & Exchange Commission of Pakistan (“SECP” or “the Commission”) has
been obtained for the issue, circulation, and publication of this Offer for Sale Document (“OFSD”) as
required under section 62, read with section 57 and section 61 of the Companies Ordinance, 1984 (“the
Ordinance”).
It must be distinctly understood that in giving this approval, the SECP does not take any
responsibility for the financial soundness of any scheme stated herein or for the correctness of any of
the statements made or opinions expressed with regard to them.
The SECP has not evaluated the quality of the offer, including justification for the premium, and its
approval of the offer should not be construed as any commitment to the same. The public / investors
should conduct their own independent investigation and analysis regarding the quality of the offer
before subscribing.
1.2 CLEARANCE OF THEOFFERFOR SALE DOCUMENTBY THE STOCK EXCHANGE
The OFSD has been cleared by the Karachi Stock Exchange (Guarantee) Limited (“KSE” or “the Stock
Exchange”) in accordance with the requirementsof itsListing Regulations.While clearing this OFSD, the
Stock Exchange neither guarantees the correctness of the contents of this document nor the viability
ofArif HabibInvestment ManagementLimited (“AHIML”or“the Company”).
The Stock Exchange has not evaluated the quality of the issue, including the justification for the
premium and its clearance should not be construed as any commitment to the same. The public /
investors should conduct their own independent investigation and analysis regarding the quality of
the offer before subscribing.
1.3 FILING OF THE OFFER FOR SALE DOCUMENT AND OTHER DOCUMENTS WITH
THE REGISTRAR OF COMPANIES
On behalf of the Offerors, the Company has delivered to the Registrar of Companies, Companies
Registration Office (“CRO”), Karachi, as required under section 57(3) and (4) of the Ordinance, a copy of
the OFSD signed on behalf ofOfferors,together with the following documents attached hereto:
(a) A letter dated May 22, 2008, from the Auditors of the Company, M. Yousuf Adil Saleem &
Co., Chartered Accountants, consenting to the publication of their name in the OFSD, as
required undersection 55 of the Companies Ordinance, 1984, which contains in Part V certain
statements and reports issued by them as experts(which consent has not been withdrawn).
(b) Written confirmations of the Auditors, Legal Advisor, and Bankers to theOffer mentioned in
this OFSD consenting to act in their respective capacities, as required under section 57(5) of
the Ordinance.
(c) Copies of material contracts and agreements mentioned in Part 7.7 of this OFSD as required
under section 57(4) of the Ordinance.
(d) Consent of the Directors and Chief Executive of the Company who have consented to their
respective appointments being made and their having been named or described as such
Directors and Managing Director / Chief Executive in this OFSD, as required under Section
57(3) of the Ordinance, read with sub-clause(1) ofclause(4) ofpart 1ofthesecondschedule of
the Ordinance.
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Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited
1.4 LISTINGATTHESTOCK EXCHANGE
Application has been made to theKarachiStock Exchange for permission to deal in and for the quotation of
theshares of theCompany.
If for any reason, the application for formal listing is not accepted by the Stock Exchange, the Company
undertakes that a notice to that effect will immediately be published in the press, andthereafter application
money to the applicants will be refunded in pursuance of this Offer for Sale Document, as required under
the provisions ofsection 72 of the Ordinance.
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Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited
PART 2
2 SHARE CAPITAL AND RELATED MATTERS
2.1 SHARE CAPITAL
No. of shares Face value Premium Total
AUTHORIZED CAPITAL
30,000,000 Ordinary shares of Rs. 10/-each 300,000,000 - 300,000,000
ISSUED SUBSCRIBED & PAID UP
CAPITAL
Issued for cash
5,000,000 Ordinary shares of Rs. 10/-each 50,000,000 50,000,000
Issued asbonus
25,000,000 Ordinary shares of Rs. 10/-each 250,000,000 250,000,000
30,000,000 TOTAL 300,000,000 300,000,000
No. of shares Face value Premium Total
THE EXISTING ISSUED,
SUBSCRIBED & PAID UP CAPITAL
OF THE COMPANY IS HELD AS
FOLLOWS:
Major shareholders
4,799,968 Mr. Arif Habib 47,999,680 - 47,999,680
3,000,004 Mr. Nasim Beg 30,000,040 - 30,000,040
18,720,005 M/s. Arif Habib Securities Limited 187,200,050 - 187,200,050
M/s. AHIML Employees Stock Beneficial
3,479,994 34,799,940 - 34,799,940
Ownership Trust
Directors
4 Mr. Saleem Chamdia 40 - 40
4 Mr. Sirajuddin Cassim 40 - 40
4 Mr. Akmal Jameel 40 - 40
4 Mr. Muhammad Shafi Malik 40 - 40
4 Mr. Muhammad Kashif 40 - 40
1 Mr. M. Qamar Beg 10 - 10
Other shareholders
4 Mr. Samad A. Habib 40 - 40
4 Mr. John Kirkham 40 - 40
30,000,000 TOTAL 300,000,000 - 300,000,000
PRESENT OFFER
No. ofshares Face value Premium Total
The present Offer of 7,500,000 ordinary
shares (25% of paid-up capital) having
par value of Rs. 10/- each (at an offer
price of Rs. 125/- per share inclusive of a
premium of Rs. 115/- per share) is being
made to the general public as under:
375,000 Employees of the Company 3,750,000 43,125,000 46,875,000
7,125,000 General Public 71,250,000 819,375,000 890,625,000
7,500,000 TOTAL 75,000,000 862,500,000 937,500,000
OFFERORS
4,799,968 Mr. Arif Habib 47,999,680 551,996,320 599,996,000
750,001 Mr. Nasim Beg 7,500,010 86,250,115 93,750,125
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Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited
1,080,032 Arif Habib Securities Limited 10,800,320 124,203,680 135,004,000
AHIML Employees’Stock Beneficial
869,999 8,699,990 100,049,885 108,749,875
Ownership Trust
7,500,000 TOTAL 75,000,000 862,500,000 937,500,000
Notes:
(i) As per Rule 3(I) (IV) of the Companies (Issue of Capital) Rules, 1996, the sponsors shall, at all times,
retain at least twentyfive per cent (25%) of the paid-up capital of the Company.
(ii) As per Listing Regulation No. 6(A) 7(i) of the KSE, sponsors’ shareholding in excess of 25% shall
not be saleable for a period of six months from the date of public subscription.
(iii) As per Listing Regulation 6(A) 7(ii) of the KSE, the shares subscribed by the employees of the
Company shall not be saleable for a period of 6 months fromthe date of public subscription.
2.2 OPENING AND CLOSINGOF SUBSCRIPTION LIST
The subscription list will Insha’Allah open on18th July, 2008atthe commencement of banking hours
and will close on19th July, 2008at the close of banking hours.
2.3 INVESTOR ELIGIBILITY
All Pakistani residents, provident funds/trusts, pension/gratuity funds (subject to the term of their trust
deeds), financial institutions and companies, body corporate or other legal entities (to the extent permitted
by their constitutive or corporate documents, as the case may be) are allowed to subscribe to the shares
offered to the general public.
2.4 OFFER PRICE, MINIMUM AMOUNT OF APPLICATION,AND BASISOF ALLOTMENT
OF SHARES
(a) This offer is being made at a price of Rs. 125/- per share of par value of Rs. 10/- each. The offer
price includes apremium of Rs.115/-per share.
(b) Applications must be made for 500 shares or in multiples of 500 shares only. Applications, which
are neither for 500 shares nor for multiples of 500 shares, shall be rejected.
(c) The minimum amount of application for subscription of 500 shares both in cases of physical
transfer and transfer under book-entry system is Rs.62,500/-. The transfer fee shall be borne bythe
Offerors.
(d) Application for shares below the value of Rs.62,500/-willnot be entertained.
(e) SUBMISSION OF FICTITIOUS AND MULTIPLE APPLICATIONS (MORE THAN ONE
APPLICATIONS IN THE NAME OF SAME PERSON) IS PROHIBITED AND SUCH
APPLICATIONS’ MONEY SHALL BE LIABLE TO CONFISCATION UNDER SECTION
18-A OF THE SECURITIESAND EXCHANGE ORDINANCE, 1969.
(f) If the shares to be offered to the general public are sufficient for the purposeto accommodate all the
applications then, all applications shall be accommodated.
(g) If this offer is oversubscribed in terms of number of applications and amount, the shares will be
allotted by conducting computer balloting in the presence of representatives of the Stock Exchange
in the following manner:
i. If all applications for 500 shares can be accommodated, then all such applications will be
accommodated first. If all applications for 500 shares cannot be accommodated, then balloting
will be held among the applicationsfor 500 shares only.
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Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited
ii. If all applications for 500 shares have been accommodated, and shares are still available for
allocation, then all applications for 1,000 shares will be accommodated. If all applications for
1,000 shares cannot be accommodated, then balloting will be held among applications for 1,000
shares only.
iii. If all applications for 500 shares and 1,000 shares have been accommodated, and shares are still
available for allocation, then all applications for 1,500 shares will be accommodated. If all
applications for 1,500 shares cannot be accommodated, then balloting will be held among
applications for 1,500 shares only.
iv. If all applications for 500, 1,000 and 1,500 shares have been accommodated, and shares are still
available for allotment, then all applications for 2,000 shares will be accommodated. If all
applications for 2,000 shares cannot be accommodated, then balloting will be held among
applications for 2,000 shares only.
v. After the allotment in the above mentioned manner, the balance shares, if any,willbe allotted
in the following manner:
1. If the remaining shares are sufficient to accommodate each application for over 2,000
shares, then 2,000 shares will be allotted to each applicant and the remaining shares will be
allotted on a pro-rata basis.
2. If the remaining shares are not sufficient to accommodate all remaining applications for at
least 2,000 shares, then balloting will be conducted for allocation of 2,000 shares to each
successful applicant.
(h) If the offer is over subscribed in terms of amount only, then the allocation of shares will be made in
the following manner:
i. First preference will be given to applicants who applied for 500 shares;
ii. Next preference will be given to applicants who applied for 1,000 shares;
iii. Next preference will be given to applicants who applied for 1,500 shares;
iv. Next preference will be given to applicants who applied for 2,000 shares;
After allocation in the above manner, the balance shares, if any, will be allotted on pro-rata
basis to the applicants who applied for more than 2,000 shares.
(i) In case the offer is undersubscribed, all the applicants whose applications are accepted will be
allotted shares applied for and the remaining shares will be taken up by the underwriters in
proportion to their respective underwriting commitments.
(j) In addition to the above, employees of the Company have been given preferential allocation of
375,000 shares in the Offer for Sale of shares, to which they will subscribe on the public
subscription days.
(k) Every permanent employee of the company is entitled to participate in the employee quota of
public offer.
(l) No advance will be given by the company to the employees to apply for subscription of shares.
(m) The basis of allotment of shares out of the quota allocated to employeesshall be the same as for the
general public
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Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited
(n) In case the offer to the employees is undersubscribed, then the remaining shares will be allocatedto
the general public
(o) Incase both offer to the employees and to the general public is undersubscribed; all the remaining
shares shall be taken up by the underwriters in proportion to their respective underwriting
commitments.
(p) Allocation of shares will be subject tothescrutiny of the applications.
2.5 REFUND OF SUBSCRIPTION MONEY TO UNSUCCESSFUL APPLICANTS
The Company, on behalf of the Offerors, shall take a decision within 10 days of the closure of the
subscription list as to which applications have been accepted or are successful. Refund of money in case of
unaccepted or unsuccessful applicationswill bemadewithin 10 days ofthe date of such decision, as required
under the provisions ofsection 71 of the Ordinance.
As per sub-section (2) of section 71 of the Ordinance, if the refund as required by sub-section 1 of section 71
of the Ordinance is not made within the time specified therein, the Offerer shall be liable to repay the
money with surcharge at the rate of 1.5%, for every month or part thereof from the expiration of the 15th
day and, in addition, to a fine not exceeding Rs. 5,000/- and in the case of continuing offence, to a further
fine not exceeding Rs. 100/-per day after the said 15thday of which default continues.Provided,anOfferers
shall not be liable if they proves that the default in making the refund was not due to misconduct or
negligence ontheirpart.
2.6 ISSUE AND DISPATCH OF SHARE CERTIFICATES
The Company will dispatch to the successful applicants, physical share certificates through the Bankers to
the Offeror credit to the Central Depository System (the “CDS”) accountswithin 30 days of the close ofthe
publicsubscription list, as perListing Regulations of the KSE.
Shares will be transferred either in scripless form in the CDS of the Central Depository Company (the
“CDC”) or in the shape of physical scrips on the basis of option exercised by the successful applicants. Shares
in physical scripformwillbe dispatched to the Bankers to theOffer within 30 days from the date of closing
of subscription list, whereas scripless shares will be credited through book entry into the respective CDS
accounts of thesuccessful applicantsmaintainedwiththe CDC.
The applicants who opt for receipt of shares in scripless form in the CDS should fill in the relevant columns
of theApplicationForm. In order to exercise the scripless option, the applicant should have a CDS account
at the time of subscription.
If theCompanydefaultsin complying with the requirements of the Listing Regulations of the KSE, it shall
pay to the KSE a penalty of Rs. 500/-per day orpart thereof during which the default continues. The KSE
may also notify the fact of such default and the name of the Companyby notice and also by publication in
itsReady Board Quotation.
2.7 TRANSFER OF SHARES
2.7.1 PhysicalScrips
Thedirectors of theCompanywillnot refuse to transfer any fully paid shares unless the transfer deed is for
any reason, defective or invalid under the provisions of Section 77 of the Ordinance. Provided that the
Companyshall within 30 days from which the instrument of transfer was lodged with it, notify the defect or
invalidity to the transferee who shall, after the removal of such defect or invalidity, be entitled to re-lodge
the transfer deed with theCompany.
2.7.2 Transfer under book entry system
The shares maintained within the CDS in the book entry form shall be transferablein accordance with the
provisions of the Central Depositories Act, 1997 and the CDC Regulations.
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