Service Global Footwear is Looking for a $10 Million IPO at PSX - Android

Service Global Footwear Ltd. – Pakistan’s largest shoe exporter which is a part of Service Industries Ltd. – is planning… Read More

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Service Global Footwear Ltd. – Pakistan’s largest shoe exporter which is a part of Service Industries Ltd. – is planning an initial public offering at the Pakistan Stock Exchange (PSX), reported Bloomberg.

The Lahore-based company aims to raise at least Rs. 1.6 billion ($10 million) in funds to invest in its parent company’s tire joint venture.

Shahid Ali Habib, the Chief Executive Officer (CEO) at Arif Habib Ltd. and the sole adviser on the IPO revealed that it will offer 41 million shares at a floor price of Rs. 38 each.

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He said that the company may fetch a higher price by as much as 40 percent, leading Service Global Footwear to raise approximately $14 million, and added that it is scheduled to start taking investor orders by the last week of March.

Service Global Footwear has a north of 13,000 employees and a strong position in the shoe and tire industries in Pakistan. Its footwear unit sells products directly domestically and it is also among the major suppliers of international brands including Inditex SA’s Zara, Levi Strauss & Co.’s Dockers, and Reckitt Benckiser Group Plc’s Scholl.

It exports its goods to European countries, including Germany, France, and Italy. With the capacity to produce 3.6 million pairs of shoes annually, and Service Global Footwear has an annual revenue of about $44 million.

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Habib stated that Service Global Footwear plans to use the IPO proceeds to buy about 20 percent stakes in a joint venture set up by Service Industries and China’s Chaoyang Long March Tyre Co.

The proceeds are expected to be invested in a project that costs about $250 million for over seven years to manufacture and export truck and bus radial tires from a facility near Karachi. Bloomberg reported that this is the largest investment in a tire manufacturing plant in the country and that the operations for the first phase will commence in August.

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