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The government is planning to sell a stake, worth up to $300 million, in United Bank Ltd (UBL) through a global share sale, and it has invited six investment banks to pitch for the deal, people familiar with the matter said on Wednesday.
Citigroup, Credit Suisse, Deutsche Bank, Goldman Sachs, J.P. Morgan and Merrill Lynch are all bidding for the $200 million to $300 million global depository receipt (GDR) sale, sources said. Official sources said that the decision for the deal''s lead manager would be made by early April, and the deal should be completed by the end of June.
The government is only selling part of its roughly 45 percent stake in UBL. UBL shares fell 2.15 percent, while the Karachi 100 Index was down only 1.09 percent. The government has been trying to offload part of its stake in UBL since June 2005, when it tried to sell 15 percent through an initial public offering that eventually failed to draw enough subscribers. A consortium of UAE-based Abu Dhabi Group and British conglomerate, Bestway Group, bought 51 percent of UBL from the government in 2002.
The government was planning a 20 percent stake sale in February 2006, according to official sources, but the deal never made it to the market. Pakistan is being tipped by foreign investment bankers as a potential hotbed of equity issuance activity as the country''s economy is growing at nearly 7 percent, and the government is pushing to privatise some of its biggest companies.
The country''s largest listed firm, the Oil and Gas Development Co (OGDC), raised $813 million through a GDR sale in December, and the government is also planning a stake sale of top oil marketing firm, Pakistan State Oil (PSO).
The KSE-100 is up 12 percent this year after a 5 percent increase in 2006. Pakistan began popping up on the radar screens of foreign investors after the index soared 54 percent in 2005. Pakistan''s liberal foreign investment rules, which can be rare in emerging markets, are a further draw to overseas buyers.

Copyright Reuters, 2007

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