Court sanctions telecom merger after finding the scheme lawful, fair and compliant with the Companies Act, 2017

The Islamabad High Court (IHC) has approved the merger of Telenor Pakistan (Private) Limited with Pakistan Telecommunication Mobile Limited (Ufone), clearing a major legal hurdle for the consolidation of two of Pakistan’s leading mobile network operators.

Justice Khadim Hussain Soomro sanctioned the merger scheme, holding that it complies with the provisions of the Companies Act, 2017 and is neither unlawful nor contrary to the public interest.

Under the court’s order, all assets, properties, rights, obligations and liabilities of Telenor Pakistan (Private) Limited will be transferred to Pakistan Telecommunication Mobile Limited once the merger becomes effective.

The judgment further provides that Telenor Pakistan will be deemed dissolved without undergoing separate winding-up proceedings following the completion of the merger.

Court orders implementation of merger

The IHC directed the petitioner to submit a certified copy of its judgment to the Registrar of the Securities and Exchange Commission of Pakistan (SECP).

The Registrar has been instructed to take all necessary measures to implement the approved merger scheme in accordance with the applicable legal framework.

The court also directed the petitioner to ensure full compliance with all legal, regulatory and financial requirements necessary for the effective implementation of the merger.

Merger declared fair and in public interest

In its detailed judgment, the court observed that its role in approving a scheme of arrangement is supervisory in nature and limited to determining whether the statutory requirements prescribed by law have been fulfilled.

After examining the merger proposal and the supporting record, the IHC concluded that all conditions laid down under the Companies Act, 2017 had been satisfied.

The court held that the proposed merger is fair, lawful and not against the public interest, and accordingly sanctioned the scheme under the relevant provisions of the law.

The approval represents a significant development for Pakistan’s telecommunications industry, paving the way for the integration of Telenor Pakistan’s operations into Ufone, subject to the fulfilment of all remaining statutory and regulatory requirements.