TRG takeover battle: Zia Chishti lands favourable SHC ruling amid mounting financial pressure
The tender was to remit up to $53 million to Pakistani shareholders of TRG Pakistan, and had been placed on hold pending the hearing of the petition.
SHC restrains Zia Chishti, wife from transferring shares of TRG Pakistan: notice
The judge ruled that the company violated Section 286 of the Companies Act relating to shareholder oppression and that such oppression took place with the purchase of shares of TRG Pakistan Limited by Greentree Holdings.
The judge has ordered the abatement of the Greentree Holdings tender, the conversion of the shares held by Greentree Holdings into treasury shares of TRG Pakistan and the holding of Company elections.
A successful completion of the tender would have accorded control of the company to Greentree Holdings, in addition to providing an exit to company shareholders.
In a notice to the PSX issued today, the company has stated that the judge's order contains 'various irregularities and infirmities' and is 'assessing legal options, including challenging the decision by filing an appeal before the Honourable Supreme Court of Pakistan'.
Market analysts believe that the company will appeal the ruling.
Market observers expressed disappointment at the ruling of the Sindh High Court, as the tender provided shareholders an opportunity to lock in a near 40% premium to the current share price.
The company's share price responded negatively to the news of the ruling, dropping 12% on the prospect of a lack of clarity on the company's future.
Since late 2021, the company has been mired in a takeover battle between Chishti and his allies and the current management of TRG.
Chishti resigned as CEO of the company following disclosure in US Congressional testimony of an arbitration award against him for sexual harassment and assault of an ex-employee, in which he had to pay the former employee over $5 million in damages.
TRG's management has held that any association of Chishti with the company would be fatally damaging to the Company's assets given his reputation.
Since his exit from the company, Chishti has filed several defamation suits relating to his sexual misconduct award.
US arbitrator orders Zia Chishti to pay $9.1mn to TRG International
In the United States, he sued the former employee for defamation but was dismissed by a US judge.
In the United Kingdom, Chishti sued The Telegraph for carrying an article that he deemed defamatory, and settled with the newspaper in March 2025 with The Telegraph providing an apology.
Meanwhile, in Pakistan, Chishti sued the board and management of TRG for defamation for referring to his arbitration award in court filings; those proceedings have been suspended by order of the Supreme Court.
Chishti's court victory comes against the backdrop of severe creditor pressure on him.
In January 2025, he lost an arbitration filed against him by TRG International for pledging his shares in TRG Pakistan for a loan extended to him by JS Bank, apparently for the purpose of building up his shareholding in the Company.
In its notice today, TRG has informed that this arbitration award, which included a $9 million payment order against him, has been confirmed for collection by a United States Federal judge.
In addition, in January 2025, Chishti defaulted on the above-mentioned Rs3 billion loan from JS Bank, which has attempted to seize his shares in the Company as collateral but has been prevented from doing so by several stay orders relating to the arbitration award enforcement.
Chishti's financial woes are further complicated by the recent disclosure of a tax lien of $10 million placed on Chishti's assets by the United States Internal Revenue Service, for unpaid United States federal taxes.
Industry observers have expressed dismay at the continuing upheaval within the country's leading technology player, especially since the tender was set to provide clarity to the future of the company.
With the recent ruling, the battle seems likely to continue.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Business Recorder
3 hours ago
- Business Recorder
FM Dar arrives in Washington to discuss bilateral trade, economic cooperation
Deputy Prime Minister and Foreign Minister Mohammad Ishaq Dar has arrived in Washington DC, where he is scheduled to meet his US counterpart, Secretary of State Marco Rubio, at the Department of State. They will discuss important facets of Pak-US relations exploring ways and means to strengthen bilateral ties, with a particular focus on promoting trade, investment and economic cooperation, state-run media Radio Pakistan reported. The deputy prime minister is also scheduled to speak at the US think tank, The Atlantic Council, sharing Pakistan's perspective on regional and global issues as well as the future of Pak-US relations. Pakistan's Ambassador to US Rizwan Saeed Sheikh and senior embassy officials received Dar at the train station in the US capital. Reciprocal tariff: Pakistan officials to meet Trump administration, Bloomberg reports During his week-long visit, Dar attended high-level signature events of Pakistan's UN Security Council (UNSC) presidency in New York, while he met UN Secretary General António Guterres, on the sidelines of the High-Level Political Forum (HLPF) on Sustainable Development, as well. A day ago, Bloomberg, quoting US State Department Spokesperson Tammy Bruce as saying, reported that a Pakistani delegation will soon meet the administration of US President Donald Trump in a bid to reach an agreement on a trade deal. In a US Department of State press briefing on Wednesday, Bruce said she will attend the meeting between the Pakistani delegation and US officials. Islamabad is looking forward to the 29% reciprocal tariffs to be lifted that the Trump administration levied initially, Bloomberg said. The South Asian country has proposed to increase imports of soybeans and cotton, while it already is the second-largest buyer of US cotton by value, after China. Whereas, Pakistan's biggest export destination is the United States. Bilateral ties between Pakistan and US have improved in recent times, with Trump's holding a rare meeting with Field Marshal Asim Munir at the White House. The FO stated on July 19 that FM Dar's visit is an indication of Pakistan's increasing importance in both its relations with the US and the global landscape. Moreover, in order to complete a trade agreement, Finance Minister Muhammad Aurangzeb has also visited the United States and met with US Secretary of Commerce Howard Lutnick and US Trade Representative Jamieson Greer in Washington recently to advance economic cooperation, as per the Ministry of Finance. Reuters last week reported that the negotiations, focused on reciprocal tariffs, are part of a broader push to reset economic ties at a time of shifting geopolitical alignments and Pakistan's efforts to avoid steep US duties on exports.
Business Recorder
6 hours ago
- Business Recorder
Intra-day update: rupee gains ground against US dollar
The Pakistani rupee strengthened against the US dollar, appreciating 0.25% during the opening hours of trading in the inter-bank market on Friday. At 10am, the currency was hovering at 283.50, a gain of Re0.72. On Thursday, the currency settled at 284.22. Globally, the US dollar steadied near two-week lows on Friday, on track for its biggest weekly drop in a month, as investors contended with US tariff negotiations ahead of a deadline while looking ahead to central bank meetings next week for clues on policy. Both the US Federal Reserve and the Bank of Japan are expected to hold rates at next week's policy meetings, but traders are focusing on the subsequent comments to gauge the timing of the next move. The prospect of rate hikes by the BOJ had improved, she added, after a trade deal struck with the United States this week lowered tariffs to 15% on auto imports from Japan. The yen stood at 147.10 to the dollar, on course for a weekly gain of 1%, its strongest such performance since mid-May. The dollar index, which measures the US currency against six other units, was at 97.448, set for a drop of 1% this week, its weakest performance in a month. Oil prices, a key indicator of currency parity, rose on Friday, buoyed by optimism over a potential trade deal between the US and the European Union and reports of Russian plans to restrict gasoline exports to most countries. Brent crude futures gained 17 cents, or 0.3%, to $69.35 a barrel by 0027 GMT. US West Texas Intermediate crude futures climbed 15 cents, or 0.2%, to $66.18 per barrel. Oil settled 1% higher on Thursday, driven by media reports of expected cuts to Russian gasoline exports. This is an intra-day update
Business Recorder
8 hours ago
- Business Recorder
PMI streamlines local operations: PMPKL takes steps to delist from PSX
KARACHI: Philip Morris (Pakistan) Limited (PMPKL), the local arm of global tobacco giant Philip Morris International (PMI), has formally taken steps to delist from the Pakistan Stock Exchange (PSX), signaling a major shift in its corporate strategy. The move, aimed at consolidating operations and enhancing group-level efficiency, has reached a critical stage with the company's buyback offer now disclosed in line with voluntary delisting requirements. In a notice issued to the Pakistan Stock Exchange, PMPKL reiterated that the delisting proposal was first approved by its Board of Directors at a meeting held on March 25, 2025, in Karachi. Under Rule 5.14 of the PSX Voluntary Delisting Rules, the board resolved to initiate the delisting process. As part of this transition, Philip Morris Investments B.V., the company's majority shareholder and sponsor, has committed to buying back 1,444,931 shares from minority shareholders at the price of Rs 1300 per share. Philip Morris Brands SARL, the co-sponsor, will retain its shareholding in the now private entity. This move marks a significant milestone in the journey of PMPKL, which originally entered the Pakistani market by acquiring Lakson Tobacco Company Limited, subsequently rebranding to its current identity on February 25, 2011. The company is engaged in the manufacture and sale of cigarettes and tobacco products, and has operated under the banner of one of the world's leading tobacco firms. Analysts noted that the intended delisting reflects a broader trend among multinational entities reassessing the viability and regulatory landscape of public listing in emerging markets. The move, once completed, will make Philip Morris Pakistan a privately held company again — allowing its sponsors more direct operational control in a challenging regulatory and fiscal environment. Market observers view the step as part of a global realignment by PMI to optimize capital structures and reduce reporting burdens across its emerging market entities. Copyright Business Recorder, 2025
