Matco Foods Approves Demerger of its Corn Starch Division

Matco Foods Limited (PSX: MFL) has approved the demerger of its Corn Starch Division into a wholly owned subsidiary, Matco Corn Products (Private) Limited (MCPPL), as part of its broader corporate restructuring strategy. According to a filing at the Pakistan Stock Exchange, the company’s Board of Directors approved the restructuring through circular resolutions passed on May 23, 2025. The move follows earlier disclosures made by the company on November 25, 2024, February 28, 2025, and May 9, 2025, which outlined Matco’s vision to separate the Corn Starch Division and seek growth capital for its expansion. Under the proposed arrangement, certain assets, liabilities, and undertakings of the Corn Starch Division will be transferred and merged into MCPPL. In return, MCPPL will issue shares in favor of Matco Foods. The demerger and subsequent merger into MCPPL will be executed under Sections 279 to 283 and 285(5) of the Companies Act, 2017, through a Scheme of Arrangement. This scheme remains subject to the approval of shareholders, creditors, and regulators, as well as the sanction of the High Court of Sindh at Karachi. The restructuring is a strategic move aimed at unlocking value and enhancing growth potential within Matco’s business segments.