⚡ Flash Summary

Reliance Cotton Spinning Mills Limited (RCML) is holding an Extraordinary General Meeting (EOGM) on December 8, 2025, to approve a Scheme of Arrangement. This scheme proposes the amalgamation of RCML with Sapphire Fibres Limited (SFL). Shareholders will receive 0.40 shares of SFL for each share of RCML they hold. The scheme aims to eliminate cross-holdings and improve the operational efficiency of the merged entity, subject to court approval.

📌 Key Takeaways

• 🗓️ The Extraordinary General Meeting (EOGM) is scheduled for December 8, 2025.
• 🤝 RCML is proposed to be amalgamated with Sapphire Fibres Limited (SFL).
• ⚖️ The Scheme of Arrangement is subject to the approval of the Honorable High Court of Sindh.
• 🔄 The share swap ratio is set at 0.40 shares of SFL for every 1 share of RCML.
• 🌐 The amalgamation aims to eliminate cross-holdings between RCML and SFL.
• 🔗 Shareholders can access the Scheme details online at http://www.sapphire.com.pk/rcsml/notices.htm.
• 🏢 Physical copies of the Scheme are available at the company’s registered office at 312- Cotton Exchange Building, Karachi.
• 🚫 Share transfer books will be closed from December 5, 2025, to December 8, 2025.
• 🗳️ Voting will be conducted through postal ballot and e-voting, in compliance with SECP directives.
• 💻 Arrangements are made for virtual participation in the EOGM via Zoom application.
• 📑 Members need to register for virtual participation by emailing contact@sapphiretextiles.com.pk with a copy of their CNIC.
• 🏢 Hameed Majeed Associates (Private) Limited is the Share Registrar.
• 📜 The draft resolution for the scheme will be considered by shareholders at the EOGM.
• 🧾 Shinewing Hameed Chaudhri & Co. has audited financial statements of the company for the year ended June 30, 2025; these will be available for review.

🎯 Investment Thesis

Given that RCML is being absorbed into SFL, a HOLD recommendation is appropriate for RCML shareholders. Existing shareholders of RCML will be given shares of Sapphire Fibres Limited. The potential upside depends on the successful integration of RCML and SFL, and the realization of synergies. Since current RCML shareholders will become SFL shareholders, the recommendation hinges on the outlook for SFL. Further analysis of SFL is required to make a definitive BUY/SELL/HOLD decision for the combined entity.