PM for giving Discos to provinces

ISLAMABAD: Prime Minister Shehbaz Sharif is all set to hold meeting with Chief Ministers to convince them of provincialisation of at least one power Distribution Company (Disco) before placing this proposal before the Council of Common Interests (CCI).

This decision was taken at a meeting of Strategic Roadmap on Privatisation held on February 8, 2023 with the Prime Minister in the chair.

The meeting discussed progress on privatisation of Pakistan Steel Mills (PSM), National Power Parks Management Company Limited (NPPMCL), Heavy Electrical Complex (HEC), House Building Finance Corporation (HBFC), First Women Bank (FWB) and private sector management of Discos.

The officials of concerned ministries shared update on the entities, which fall under their administrative control and sought Prime Minister’s guidance for future approach.

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After detailed discussion, Prime Minister directed Privatisation Commission (PC) to shortlist firms through their enabling regulations for quick hiring of Financial Advisors (FAs) to fast track the privatisation/ divestment process of listed SoEs.

PC has also been asked to make earnest efforts to re-engage with pre-qualified bidder (only one currently) for PSM through a multi-pronged strategy to keep intact its interest in the transaction. With this context, PC in consultation with Financial Advisors of the investor, i.e., Bank of China and China-Pak Investment Company will address concerns of the bidders.

The meeting decided that to expedite the divestment of Pakistan Steel Mill, issuance of NoC by SSGC and withdrawal of litigation/ stay order against PSMC (to facilitate transfer of Core Operating Assets as envisaged in the SoA). Minister of State for Petroleum and Secretary Privatisation Commission would meet CM Sindh and resolve this issue at the earliest.

On NPPMCL, Secretary Power Division has been directed to share data/ working files of valuation of NPPMCL with the Minister Finance for review. Furthermore, Minister Finance will hold a meeting to discuss/ review the valuation numbers with Power and Petroleum Divisions and prepare recommendation for a follow-up meeting. Power Division is tasked to follow up on the template of Non-Disclosure Agreement (NDA) with TAQA-UAE for fast track approval and signing. The virtual data room of PC will be available to investors for next steps thereafter.

Minister Finance briefed the Prime Minister regarding delisting of NPPMCL from the active privatisation list and shared that delisting (duly approved by CCoP) is not required to divest the asset, NPPMCL, under G2G arrangement. With this context, the Privatisation Commission is to conclude the matter with the Credit Suisse (Transaction Advisor) for finalization of transaction structure including its valuation.

PC has also been directed to expedite the financial closure of privatisation of Heavy Electrical Complex (HEC). Minister Finance informed the meeting that ECC has already directed the PC to finalize/ complete the land related matters of HEC by Feb 15, 2023. Principal Secretary to PM is to coordinate with Security Planning Division (SPD)/ Secretary Privatisation to fast track the finalization of land related matters as per PM’s directions.

To expedite the privatisation process of House Building Finance Corporation (HBFC), PC is to schedule a meeting HBFC Board to pre-qualify the investors and sign the NDA for next steps.

Finance Division has been directed to finalize/ issue the audited financial accounts of the First Women Bank Ltd (pending from 2019 to date) to allow PC to proceed with marketing and privatisation process.

Prime Minster has desired the provincialisation of at least one (minimum number) power distribution companies (Discos) per province at fast pace. The Power Division is to prepare and circulate position paper to the relevant provinces. Also Power Division in coordination with SAPM-Governance Effectiveness (GE) would undertake the groundwork for finalizing the provincialisation proposal before consideration by CCI.

Principal Secretary to PM has been directed to schedule the Prime Minister’s meeting with the Chief Ministers to discuss the initiative of provincialisation of Discos after position paper is circulated by Power Division

Secretary PC, in coordination with SAPM-GF, would schedule a follow-up meeting of privatisation and G2G Framework today (Feb 16).

Copyright Business Recorder, 2023