Book building of OGDCL early next month: minister our correspondent Friday, October 24, 2014 From Print Edition New 0 0 0 KARACHI: The book building exercise for the sale of 10 percent stake of the Oil and Gas Development Company Limited (OGDCL) would start in the first week of November soon after Muharram holidays, Minister of State for Privatisation Muhammad Zubair said on Thursday. “We are going ahead on the book building on November 5, 6 and 7,” Zubair told The News. The minister said the book building process was delayed for three weeks, as the government waited for the decision of the Supreme Court over its appeal against the stay orders issued by the Peshawar High Court on the divestment of the OGDCL shares. The Peshawar High Court had stopped the federal government from divesting the OGDCL shares on the petition filed by the PTI-led government of the Khyber-Pakhtunkhwa, but the apex court in its interim order allowed the central government to go ahead with the sale of the shares to companies with higher bids. The government is seeking to raise around $815 million with the sale of OGDCL shares, the largest offering from a local company in almost eight years. The government is offering 323 million ordinary shares and global depositary shares (GDS), each representing 10 ordinary shares. In a concise statement submitted before the Supreme Court, the federal government said that if the privatisation of 10 percent shares of the OGDCL was not completed, Pakistan would be exposed to “great financial loss”. OGDCL’s sell-down would be the biggest offering from a Pakistan-based company since the government sold $913.6 million worth of GDS in the oil exploration company in London in late 2006. The Bank of America Merrill Lynch, Citigroup, and Pakistani broker KASB Securities are handling the shares sale. The government requested the top court to dismiss the petition of the Khyber-Pakhtunkhwa government against the privatisation of OGDCL. “It would be an irretrievable loss, which would affect the future prospects of foreign investments,” said statement by Additional Attorney General Waqar Rana. Zubair said the government had to wait for the announcement of the OGDCL results for September so that the investors had a better idea of where the company’s standing because an investor would never invest his money unless he looks at the latest results of the company. He dispelled the impression that the privatisation process is being done under the pressure of the International Monetary Fund (IMF) and said the government is pursuing this process for the sake of national interests. “I have absolutely no issue in convincing the IMF if this deal would not have been possible…we respect their concerns, but we also need to make them understand what the priorities of Pakistan are.” The IMF delayed the release of the fourth tranche of $550 million due in September because of Pakistan’s failure to meet the performance criteria, which included seven percent increase in the power tariff, launch of the $1 billion Sukuk or Islamic bonds and privatisation of at least three state-owned entities. The government of Pakistan Muslim League planned to privatise 68 companies, including 10 banks and raise $5 billion in the next two years. Finance Minister Ishaq Dar is optimistic that the IMF would release the fourth and fifth tranches of $1.1 billion combined by early December though there are doubts that how could this be done when Pakistan is not meeting the conditions set by the global lender. The government, still reeling from the political crisis stoked by the PTI and PAT protests, has recently withdrew the decision to increase the power tariff on the instructions of Prime Minister Nawaz Sharif. And there are no signs that it is going to launch Sukuk anytime soon. However, the Privatisation Commission is pushing ahead with its plans to sell OGDCL stakes. “This transaction is vital for Pakistan than anybody else,” Zubair added. Todays Newspaper Top story National World Business Sports Karachi Lahore Islamabad Peshawar Editorial Opinion Newspost
Posted on: Fri, 24 Oct 2014 02:58:06 +0000
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