ISLAMABAD: A panel headed by Minister for Privatisation has cleared transaction of Services International Hotel (SIH), saying that the valuation of the property was fair at the time of privatisation, well-informed sources told Business Recorder.
During a presentation made to Prime Minister on June 8, 2022 on privatization transactions, he directed the Privatisation Commission (PC) to “present the details of SIH transaction in the Cabinet Committee on Privatisation (CCoP) for review.”
One of the Cabinet members had accused the previous government of selling the hotel at a throwaway price.
Accordingly, the matter was placed before CCoP in its meeting held on June 24, 2022. The CCoP constituted a sub-committee under the chairmanship of Minister for Privatisation, representatives of Finance Division, Law & Justice Division and Privatisation Commission as Member to review the SIH transaction. The decision of CCoP was ratified by the Federal Cabinet on July 4, 2022.
Lahore’s Services International Hotel auctioned for over Rs1.951 bn
In compliance with the decision of Federal Cabinet, four meetings of the sub-committee were convened, ie, on June 29, 2022, July 6, 2022, July 28, 2022 and August 16, 2022. It was decided by the Sub-Committee that a fresh valuation of the property needs to be conducted through an independent Punjab based valuer on the Panel-1 list of Pakistan Banks Association excluding the previous four valuers. The Terms of Reference (ToRs) were approved by the committee. Out of 80 valuers requested, 27 submitted the quotations and after evaluation, the sub-committee selected M/s A J Valuers Associates (Pvt) Ltd, who submitted their valuation report on August 15, 2022 and assessed the fresh value of Rs. 1,951,076,000 by adopting the Market Value Approach while the Residual Land Value through ‘Discounted Cash flow method’, was assessed as Rs 1,461,000,000.
The Sub-Committee after due deliberations, concluded that previous valuation was reasonable at the time it was sold and accordingly recommended it to the CCoP for necessary directions.
The Board of the Privatisation Commission in its meeting held on September 5, 2022, took note of the directions of the Prime Minister and recommendations of the sub-committee of the CCoP.
Copyright Business Recorder, 2022