The Privatisation Commission has received seven expressions of interest (EoIs) for Kot Addu Power Company (Kapco). The government has decided to list the shares of (Kapco) at Karachi, Lahore and Islamabad stock exchanges and to offer 10 percent shares to the general public with additional 10 percent shares with green-shoe option, in case of over-subscription.
Kapco is a large IPP with power generation capacity of 1600 MW. It was privatised in 1996 and the government transferred the management control to International Power Plc along with 26 percent shares. Subsequently, 10 percent additional shares were also divested to the new owners.
Total proceeds of Rs 9 billion were realised by the government in this divestment and the government now holds 64 percent of Kapco''s total 880 million issued shares.
Kapco is a highly profitable company with a good operational record. If the market response to the recent share offerings of OGDC, SSGC and Bank Alfalah give any indication, an offer of shares of a company like Kapco would most likely receive heavy response from the general investors.
The listing of Kapco would increase market capitalisation significantly and would bring a worthwhile addition, rather a leader, to the power sector companies listed on the stock exchanges.
The large quantity of shares offered would also add to the liquid share float in the market.
EoIs have been received from Arif Habib Securities Limited, BMA Capital Management Limited, Elixir Securities Pakistan (Pvt) Limited, First Capital Equities Limited, Global Securities Pakistan Limited, KASB Securities (Pvt) Limited and Orix Investment Bank Pakistan Limited.
The lead manager would be responsible for bringing the transaction to a successful conclusion within the specified timeframe. The Commission is also in the process of secondary public offering of PIA and PPL shares.