UAE groups still in race for PSO

DUBAI — Pakistan will complete the transaction of Pakistan State Oil by June this year and hold the bidding process by next two months to sell 51 per cent shares in its biggest oil company with management control.

By Muzaffar Rizvi

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Published: Tue 13 Feb 2007, 9:15 AM

Last updated: Sat 4 Apr 2015, 9:54 PM

“As many as 14 companies have shown interest in the nation's biggest fuel supplier, asset sale,” Zahid Hamid, Pakistan's Federal Minister for Privatisation & Investment said yesterday.

UAE groups are among the strong contenders for Pakistan's largest oil company, which has a market share of more than two-thirds in the country.

"Abu Dhabi Group, Al Ghurair Investment and Abraaj Capital from UAE have shown strong interest in PSO privatisation and submitted their Statement of Qualifications (SOQs) last month to participate in the bidding process likely to be held by end of March," a senior government official told Khaleej Times yesterday.

"Middle East investors have expressed interest in the energy sector of Pakistan and are pursuing various key public sector entities," he said adding that Saudi and Kuwaiti groups are also among the potential bidders for PSO.

"Consortium of Aljomaih Group, National Industries Group, Bakri International Energy Systems and Sabbagh Group Holding from Saudi Arabia and Noor Financial Investment from Kuwait are also in the race for PSO," he explained.

Goldman Sachs (Asia) Finance, Vitol S.A (Switzerland) are other international contenders while from domestic side MCB Bank, Fauji Foundation, Attock Group of companies and Kohinoor Group led by Kohinoor Textiles have submitted their SOQs for PSO.

Pakistan is making its second attempt to sell the stake in PSO. The government scrapped a plan to sell the company in 2003 after Kuwait Petroleum Corporation, one of two bidders, didn't follow through on its bid. The second bidder was Pakistan's Fauji Foundation.

PSO is the largest state-run oil company in the country as well as a listed entity on Pakistani bourses. It supplies fuels such as furnace oil, diesel, jet fuel, lubricants and compressed natural gas to consumers in Pakistan through its 3,700 outlets.

For the year ending June 2006, PSO sales revenue was in excess of Rs352 billion ($5.8 billion) and after tax profits amounted to Rs7.5 billion ($123 million).

HBL IPO: "The country will also sell shares of Habib Bank Limited, the nation's second-biggest lender, in an initial public offering by April. Habib Bank's IPO is sure to do well and State Oil will be successful this time around because the list of bidders is much longer," the minister said.

"The government is in the process of appointing advisers for Habib Bank and United Bank Limited (UBL), the third-biggest lender," Hamid said. Pakistan plans to sell global depository receipts of Habib Bank, UBL and National Bank of Pakistan (NBP) by June," he said.

"National Bank's overseas share sale will be planned once 'technical issues' are overcome," he said.

Economic expansion: Pakistan's economy is forecast by the government to expand 7 per cent in the fiscal year that began July 1, from 6.6 per cent a year ago.

"There's been a lot of buzz about Pakistan in the last two or three years," Hamid said. "We are now very prominently on the radar screen of international investors and fund managers," he concluded.

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