A sub-committee of Senate Standing Committee on Finance has sought from Privatisation Commission the minutes of transaction committee meetings as well as Privatization Commission board''s meetings on privatisation of Heavy Electrical Complex (HEC). A meeting of the sub-committee chaired by its convenor senator Kamil Ali Agha held here on Wednesday directed the PC to provide the minutes to the next meeting of the committee on December 16, 2015.
The committee expressed concern on privatisation of HEC after it was informed by the management of the company that the company has started making profit. The company''s profit would increase to Rs 400 million by June 2016 and privatisation of the company would cost to the national exchequer heavily. "If the government decides to privatise the company, the country would face a Rs 2 billion loss annually." The conveners of the committee remarked why the decision was taken to privatise the HEC when its board members were against its sell-off.
The versions of Privatisation Commission and HEC management also varied regarding Rs 400 million taken from the Bank of Khyber. The management of the company stated that the loan was taken against the raw material and finished products and the company had never approached the government for financial help for maintenance of machines. However, Secretary Privatisation contended that HEC management had requested to the government to provide Rs 350 million for maintenance of the George machine. The committee was informed that after the approval of the PC Board in 2014 the process for HEC privatisation was restarted and an Expression of Interest (EoI) was invited for acquiring 97 percent government''s shares in the company. Transaction committee meeting was attended by member of PC Board, Finance Division, Ministry of Industries, HEC, as well as two officials from PC and the transaction manager. They deliberated the pre-qualification of interested parties and the statement of qualification (SOQ) submitted by all the three interested parties. The pre-bid meeting of HEC was convened. The representatives of M/s Cargill Holdings Ltd and M/s Elahi Group of Companies participated in it but the representatives of M/s Fauji Fertiliser Company Limited did not turn up. As per the transaction timelines, the qualified parties were asked to deposit Rs 25 million as earnest money along with the bid application, however, only M/s Cargill Holding Ltd deposited the earnest money. The CCoP approved the sale of the HEC for Rs 1095 million. However, the CHL failed to execute the sale-purchase agreement and consequently their earnest money was forfeited.