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July 30, 2020

Action on PECO privatisation deferred till Aug 20

Business

July 30, 2020

ISLAMABAD: The Privatisation Board on Wednesday deferred action on legal and other issues in privatisation of Pakistan Engineering Company Limited (PECO) till next month.

The decision was taken during a meeting attended by Minister for Privatization Mohammedmian Soomro, additional secretary privatisation and the board members, according to a statement. The meeting discussed the left-over items of its previous meeting last week. The board considered the legal and other impending issues in privatization of Pakistan Engineering Company and deferred further action till 20 August, keeping in view the commitments of resolution of the ministry of industries and production.

The meeting decided to take the transaction structure before the cabinet committee on privatisation.

Last year, the government included Pakistan Engineering Company in the privatization list and decided to divest over 33 percent of stake in the company.

The Privatization Board also considered the proposal submitted by ministry of energy to attract investment from international exploration and production investors in state-owned Oil and Gas Development Company Limited (OGDCL) by increasing the divestment of government-owned shares up to 10 percent instead of earlier decision of up to 7 percent by the cabinet committee on privatisation.

The board also gave due consideration to the recent stability of crude oil prices in international markets, share price trends of OGDCL and its higher dividend yield ratio.

The board approved few directions/ guiding rules for transaction manager(s) under the privatisation ordinance. The guidelines will help transaction consultants in carrying out their responsibilities in a better manner.

The board was informed about the status of appointment/hiring of financial advisers on part of ministry of privatisation in the light of cabinet decision. The meeting told the officials that the matters regarding subject transactions should be completed steadily to avoid unnecessary delay in the completion of these transactions. The resultant cash flow was said to help the government in debt retirement.