LSE Financial Services Limited (LSEFSL) has approved a Rs159 million rights issue to create a dedicated capital pool for investments in Special Purpose Acquisition Companies (SPACs), pre-IPO opportunities and other investment avenues. The company’s board approved the issuance through a resolution by circulation dated September 14, 2026, according to a notice submitted to the Pakistan Stock Exchange (PSX).
Under the approved plan, LSEFSL will issue 159 million ordinary shares at a par value of Rs1 each. The rights issue represents approximately 58.89% of the company’s existing paid-up capital, with shareholders entitled to receive 58.89 right shares for every 100 ordinary shares they currently hold.
The company plans to allocate the majority of the funds toward SPAC investments. Around Rs120 million, representing 75% of the expected proceeds, has been earmarked for SPACs. The remaining Rs39 million, or 25%, will be used for investments in companies undertaking pre-IPO, IPO and secondary public offerings, as well as investments in associated companies. The board will retain discretion to allocate all or part of the subscription proceeds among the identified investment areas.
LSEFSL said the rights issue would establish a capital pool that would allow it to participate more actively in SPAC and private equity markets. The strategy will focus on early-stage investment opportunities and growth-oriented businesses, with the company expecting the approach to diversify its investment portfolio while providing exposure to businesses that could offer higher returns.
The company also intends to use the investment strategy to develop a pipeline of businesses with potential to reach the public markets through initial public offerings. By targeting companies at earlier stages of development, LSEFSL expects to gain access to growth opportunities while expanding the range of assets within its investment portfolio.
However, LSEFSL acknowledged that the strategy carries several investment and execution risks. These include the possibility that SPACs may not identify appropriate acquisition targets. The company also highlighted market, economic, business, regulatory, liquidity and credit risks that could affect the performance of its proposed investments.
To reduce the risk of the rights issue being undersubscribed, LSEFSL said the entire issue would be 100% underwritten by an independent underwriter in accordance with applicable laws. The company also said its substantial shareholders and directors had confirmed that they would subscribe to, or arrange subscription for, their respective rights entitlements.
Any shares that remain unsubscribed may subsequently be offered to sponsors, directors, associated undertakings or other third parties in accordance with applicable laws. In cases involving fractional entitlements, these will be consolidated and the related unpaid letters of right will be sold through the PSX. The net proceeds from such sales will then be distributed among the shareholders entitled to the proceeds.
LSEFSL has not opted to provide an Application Supported by Blocked Amount (ASBA) facility for the issue and has also not specified a minimum subscription amount. The company said draft offer documents would be submitted to the PSX and Securities and Exchange Commission of Pakistan (SECP) before being placed on the PSX and LSEFSL websites.
The dates for closure of the company’s share transfer books, which will be used to determine shareholders eligible for the rights entitlements, will be announced after the Right Share Offer Document is finalised. The process will be carried out in accordance with the Companies (Further Issue of Shares) Regulations, 2020.
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