The acquisition by China's Shandong Ruyi Technology Group of a majority stake in Pakistan's Masood Textile Mills will no longer take place.

In an announcement to the Karachi Stock Exchange yesterday (30 September), the group of investors led by Shandong said they were withdrawing their intention to acquire up to 52% of shares in Masood.

The group, including Shahid Nazir Ahmad and Nazia Nazir, had announced the acquisition deal on 10 December.

Masood Textile is one of Pakistan's few vertically integrated textile plants with in-house yarn, fabric, processing, printing and knitted apparel manufacturing facilities. The company earned PKR906m (US$8.6m) profit after tax in the fiscal year 2012-13 (July-June).

However, in the stock exchange filing, the companies said: "As...the conditions required to be fulfilled under the Share Purchase Agreement (SPA) between the sellers and the acquirers have not been fulfilled for proceeding with the acquisition transaction within the agreed timelines, the completion of the transaction is no longer possible under the terms of the SPA."

Both parties have therefore decided not to pursue the transaction any further.

The Shandong Ruyi group last year signed an agreement with the Punjab government to invest US$2bn to establish the Punjab Apparel Park near Lahore, and set up woven and knitted garment factories in the park.