Saturday December 04, 2021

PC awaits regulators’ nod for divestment of PRCL shares

November 26, 2021

ISLAMABAD: The Privatisation Commission will seek approvals of top regulators for divestment of 20 percent shares of the Pak Reinsurance Company Limited (PRCL), it said on Thursday.

Papers of Offer for Sale Document (OFSD) are being obtained from the management of PRCL after which the permission of the Securities and Exchange Commission (SECP) shall be sought and then solicit opinion of the Competition Commission of Pakistan (CCP) for determination of share price to proceed for divestment.

Officials of the commission informed the Privatisation Commission Board that met with minister for Privatisation Mohammedmian Soomro in chair. Federal Secretary Privatisation, Board members and senior officials of the Ministry attended the meeting.

Soomro stressed that the timeline for the ongoing transactions shall be strictly followed and issues emanating during the process shall be taken up with relevant ministries/divisions on priority basis.

During the meeting, other ongoing deals of privatisation were discussed including sale of remaining federal government’s properties, reference price approval of Heavy Electrical Complex (HEC).

Besides, SME Bank transaction and divestment of government’s shares in PRCL were discussed.

It is to be noted that the PC failed to sell HEC several times in the past, but now it renewed efforts to accomplish the task.

Privatisation commission in a statement said the recommendations of the privatisation board were also solicited for recommending a reference price for HEC.

The board considered reserve price computation under discounted cash flow (DCF), Market Multiple and Adjusted Net Asset Book Value (NAV) modes, allowed under Privatisation Commission (Valuation of Property) Rules 2007. Board recommended the Discounted Cash Flow method and the same would be sent to CCoP for decision(s).

The Privatisation Board was briefed about the hiring of Financial Advisors (FAs) for the sale of remaining 17 properties owned by the federal government. The board unanimously approved the hiring of FAC.

According a finance ministry report on “State-Owned Enterprises Triage: Reforms & Way Forward” released in March this year, 10 SOEs were said to be “potential privatisation candidates”.

They are: Zarai Taraqiati Bank Limited, National Investment Trust Limited, Sui Southern Gas Company Limited, Sui Northern Gas Pipelines Limited, Utility Stores Corporation (Pvt) Limited, Pakistan Expo Centres (Pvt) Limited, Pakistan Environmental Planning & Architectural Consultants (Pvt) Limited, National Engineering Services Pakistan (Pvt) Limited, Overseas Employment Corporation (Pvt) Limited and Pakistan Tourism Development Corporation. The report identified 24 SOEs for the next batch of privatisation.