The article suggested that the takeover bid had its root in a family conflict. Citing the comments of prominent stockbroker Aqeel Karim Dhedhi (AKD), the report indicated that the influential investment banker Jahangir Siddiqui, Sultana Siddiqui’s brother, had raised questions about “complex financial arrangement” HUMNL has with MD Productions. The production company, which provides content to the television network, is owned by Sultana Siddiqui and her daughter-in-law Momina Duraid, and no minority shareholder in HUMNL is entitled to its profits. This arrangement has been criticized because Sultana Siddiqui’s son Duraid Qureshi is the CEO of HUMNL. It is widely speculated that a close personal relationship with the proprietors of MD Productions might provide incentive for Duraid to purchase content from the company at an exorbitant price. As a result, the shareholders of HUMNL may incur reduced profit margins.
If AKD’s assumptions are to be believed, Jahangir purportedly raised questions about how Sultana and Momina could afford to buy property in the US. Sultana reportedly informed him that the property was bought through legitimate profits earned through MD Productions. Her brother apparently insisted that the production company be merged with HUMNL in compliance with global corporate governance practices. After a group of arbitrators allegedly opposed Jahangir’s suggestion, the investment banker recommended that a price should be set for the production company so its shares can be bought outright. But AKD claims that Jahangir’s son was adamant on a forensic audit prior to setting the price to ascertain the amount of money that was drawn out of HUMNL. This became a point of contention. As per AKD’s observations, Jahangir and his son are presumably seeking control over HUMNL and are using Kingsway Capital as a “proxy”.
It is difficult to accept AKD’s explanation as Jahangir Siddiqui has already sold his shares in HUMNL. As the article suggests, Kingsway will be unable to radically alter the management of HUMNL because Pakistani law requires a “supermajority of 75% of the shares of a company” to remove a CEO.
The report quoted sources familiar with HUMNL as saying that “they remain unconcerned about the activity in the share price of the company or the new shares being bought by the foreign investors”. Yet, HUMNL issued a public notice in August on the Pakistan Stock Exchange and confirmed the likelihood of a covert takeover. According to the notification, the company believes that Kingsway Capital is ostensibly working in tandem with Jahangir Siddiqui to give effect to the takeover. After the news item appeared, HUMNL evaluated its shareholding pattern and discovered that Aitkenstuart Pvt Ltd (APL) began accumulating its shares between April and May. The company claimed that APL sold its HUMNL shares to JS Bank Limited, Jahangir Siddiqui & Sons Limited, and Munaf Ibrahim from May 20 to June 8. HUMNL asserted that Munaf Ibrahim transferred its shares to Kingsway on June 3. After these dealings, Kingsway, JS group and Munaf Ibrahim had significant holdings in HUMNL.
Sultana Siddiqui subsequently penned a letter to the Securities and Exchange Commission of Pakistan and requested an inquiry into a possible attempt to take over her company. She claimed that APL is solely owned by OBS Healthcare Private Limited – a company with which the JS Group purportedly has a “history of business connection”.
HUMNL voiced concerns over its shares trading hands before the forthcoming elections of directors at its Extraordinary General Meeting (EOGM).
The company even demanded the revocation of the voting privileges of those involved in this takeover. Seven directors had to be elected. But HUMNL announced that eight of the 15 candidates who wished to contest were declared “ineligible”.
For their part, Jahangir Siddiqui & Co Limited (JSCL) denied any involvement in a covert attempt to take over HUMNL. In a letter to the Pakistan Stock Exchange, JSCL condemned HUMNL’s bid to club together the shareholdings of Kingsway Capital, Munaf Ibrahim and JS Group. It distanced itself from APL and Kingsway Capital, and rebutted all claims that it was supporting specific candidates in the election. JSCL even suggested that the controversy had possibly been stoked by HUMNL to postpone the election of directors.
Before the meeting, the Sindh High Court issued a stay order on HUMNL’s election of directors. Even so, the company’s EOGM was conducted amicably and the issue related to changing the share registrar was handled without any scuffles between the management and the shareholders.
It would be judicious to handle the matter with care as the relevant stakeholders have their own grievances and versions of events. While AKD’s observations do provide valuable insights into the crisis, they cannot be accepted at face value and may even be construed as hearsay without any concrete evidence.
An impartial inquiry is required into the matter. Until then, the issue must be reported in a holistic and responsible manner. 
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