Astounding Foreign Buy Worth $16.47m

Karachi, Pakistan Business News: Given that the net purchases by foreign investors had been sagging around $2 million a day and that for all of last month (August), overseas investment in equities happened to be worth just about $41 million, the net purchase of staggering $16.47 million by foreigners during a single day on Monday, seemed astounding.

The phenomenon, nonetheless, was explainable. Aside from the normal overseas investors' net purchase of $1.1 million, the big block of transaction of 291 million shares took place "off-market" in Atlas Bank Limited.

Traders with elephant memory and analytical skills were quick to fathom that it all represented the settlement of the acquisition deal of Atlas Bank.

Exactly a year ago, the bank had entered into an agreement with Surror Investments Limited ― owned by a Dubai group ― for sale of 58.31 per cent shares in Atlas Bank.

The announcement at the stock exchange at the time had stated the sale-purchase agreement with the Atlas Group shareholders to have taken place at Rs4.50 per share.

The foreign purchase of 291 million shares in Atlas Bank on Monday, accounted for 58.31 per cent of the paid-up stock in the Bank, done at the agreed price of Rs4.50 per share.

At this time last year, Suroor Investments had unfolded plans of completion of merger of the three banks under their control: Arif Habib Bank; Mybank and Atlas Bank by the end of Oct 2010.

Earlier on July 7, this year, Hussain Lawai, President & CEO of Suroor had taken over that office also in Atlas Bank, which it then said: "marked the first step towards the merger of the three banks."

The name of Arif Habib Bank already changed to "Summit Bank," would extend to the proposed new three-bank merged entity.

Oddly enough, on the ready market at the stock exchange, trading took place in only 46,605 shares of Atlas Bank, at a deeply discounted price of Rs1.61 for the stock of par value of Rs10.

Analysts and traders, however, cautioned investors not to be carried away by the "off-market" deal of the majority stake change of hands on Monday, for the Surror acquisition agreement at Rs4.50 per share had taken place in the distant past, when the stock price was that strong. n