Competition Commission of Pakistan clears merger of two brokerages

ISLAMABAD: The Competition Commission of Pakistan (CCP) has approved a scheme of arrangements for the merger of Intermarket Securities Ltd (IMS) with EFG Hermes Pakistan Ltd (EFG).

IMS is a publicly unlisted company that provides brokerage services. At the same time, EFG is a publicly listed company that offers brokerage services in stocks and financial brokerage, corporate finance, and financial research.

The Phase-I competition assessment by the CCP identified ‘Brokerage Services’ as the relevant product market. The assessment further revealed that post-transaction, IMS will dissolve without winding up, and EFG will be the surviving entity.

Under the scheme, the agreed swap ratio for the transaction is 2.16:1, whereby, for every 1 share of IMS, EFG will issue 2.16 shares to the shareholders of IMS.

The assessment further confirmed that post-transaction, the merger will lead to a slight increase in EFG’s market share, which will not result in EFG attaining dominance in the brokerage market.