The government may delay bidding for a controlling stake in the country''s top oil marketing company, Pakistan State Oil (PSO), by several few weeks due to a legal wrangle over the disqualification of a Saudi-backed bidder, an official source said on Thursday.
The government, which is selling all but 3 percent of its 54 percent holding in Pakistan State oil, had set May 19 as the bid date. The sale is expected to fetch over $500 million. But an official involved in the transaction said the date would ''most likely'' be extended.
"Though the official date is still May 19, the financial adviser has been asked to inform the bidders that it could be extended to the end of May or the beginning of June," said the official, who did not want to be identified.
US investment firm, J.P. Morgan, is the financial adviser for the sale. The Sindh High Court has suspended a government order that disqualified the Attock Group of Companies from bidding, but a final ruling in the case has yet to be made.
The official said the government had no other option but to delay the bidding while Attock''s case was pending. The Attock Group is backed by the Pharaon Group of Companies, whose sponsor is Saudi investor, Ghaith R. Pharaon. The group owns Pakistan Oilfields Limited and several other energy sector firms. Another senior government official said the government may not be able to meet its deadline of completing the transaction before the fiscal year 2006-07 ends on June 30.
The government has long-planned to sell stake in the PSO, but has postponed it several times for lack of investors'' interest.