Services Int’l Hotel transaction completed with payment by the buyer Privatization of under-utilised PSEs to be completed in transparent & efficient manner. Soomro

Privatization of under-utilised PSEs to be completed in transparent & efficient manner in line with global practices: Soomro

ISLAMABAD ( Web News )

Seeking to allay the issues pertaining to complete privatization of PSM and HEC, Federal Minister for Industries and Production Makhdum Khusro Bakhtyar and Federal Minister for Privatisation Mohammed Mian Soomro held a consultative meeting on Thursday at Ministry of Industries and Production.

In the meeting, Federal Secretary of Industries and Privatisation and the representatives of the HEC and Financial Advisors were present. The meeting was briefed on privatization status of two PSEs ie Pakistan Steel Mill Cooperation (PSMC) and Heavy Electrical Complex (HEC). It was noted that privatization process of HEC is near to completion. It’s pre-bid conference was held at Privatization Commission and bidding process is scheduled to be held on 12th January 2022.

The meeting was informed that pre-qualification bidding process of PSM under progress. The major focus was on the availability of utility connections to the newly formed subsidiary of PSMC, which is mandatory for seeking approval for scheme of arrangement (SoA). The matter has been taken up with utility companies and NEPRA for issuance of NOCs, so that, the process of privatisation/revival of PSM could be completed without hindrance in stipulated time.

While chairing the meeting, the Makhdum Khusro Bakhtyar remarked that the main objective of privatization of under-utilised public sector entities was to monetise their assets by enhancing investment opportunity. He said that space would be filled by the private sector which would bring investment and best global practices with them. He added that private sector would also bring modern technology, a change in the management mindset which would create more efficient jobs thus increasing the efficiency of the system. The Federal Minister Mohammed Mian Soomro said that privatization is an integral part of our economic development agenda. He reiterated that privatization of under-utilised PSEs would be completed in transparent and efficient manner in line with global practices.

In a small ceremony held on Thursday in the Ministry of Privatisation, the buyer handed over the cheque bearing the remaining amount of Services International Hotel, Federal Minister Mohammedmian Soomro was present at the occasion.

In June 2021, Cabinet Committee on Privatisation (CCOP) and Federal Cabinet approved privatisation of Services International Hotel (SIH) by way of sale through an Open Auction. The auction took place on August 26, 2021, M/s. Faisal Town Pvt. Ltd. submitted the highest bid amounting to 1951.7mn. (Rs.1,951,718,500/-) The Earnest Money of Rs 100 Million was deposited with the bid validity of 90 days. CCoP approved the said Bid on Sep 10, 2021, which was duly ratified by Federal Cabinet on October 26, 2021.

After signing the Letter of Acceptance (LoA) on Nov 02,2021, the buyer paid 30% of Sale amount i.e. 586mn (Rs 585,515,550/-) on Nov 15, 2021 and remaining amount of 1266mn (Rs 1,266,202,950/-) to Privatisation Commission on January 06, 2022. The buyer has fully settled the amount well before the payment deadline. The transaction of SIH marks the successful execution of this strategic transaction by Privatisation Commission in 2022.