Lately, sentiment among major business groups in Pakistan has been improving, as evidenced by their keen interest in mergers and acquisitions (M&A) of businesses available for sale. The financial system has ample liquidity, and business families are actively pursuing deals. This surge in asset acquisition is a positive sign for an economy stuck in a low-growth trap.

Several companies in the cement, pharmaceutical, airline, and food value chain sectors are up for sale, including Rafhan Maize, Attock Cement, Barrett Hodgson, and Pakistan International Airlines (PIA).

Creating new assets in Pakistan is challenging, making it more cost-effective to acquire existing businesses. Additionally, some sectors face high barriers to entry, while others enjoy monopolistic advantages.

Many business groups have deleveraged their balance sheets and are sitting on cash reserves. Their existing businesses often have excess capacity, and new government policies—such as tariff changes—could impact their traditional........

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