FALETTI's HOTEL SALE FETCHES HIGHEST OFFER OF RS.1211.1 MILLION-PC BOARD RECOMMENDS BID FOR CCOP APPROVAL

Islamabad, May 29, 2004

The Privatisation Commission has received the highest offer of Rs.1211. 1 million during two-phase round of bidding for the sale of Faletti's Hotel held here today under the supervision of Dr. Abdul Hafeez Shaikh, Federal Minister for Privatisation & Investment. The authorized representatives of those bidders who have deposited the earnest money participated in the bidding in the presence of the representatives of print and electronic media.

The representatives of the media opened the sealed bids in the first phase of the bidding round. M/s 4 B Marketing gave the highest offer of Rs.1211. 1 million while the other bids were: M/s Elite Home Fashions (pvt) Limited Rs.860 million, M/s Tourism Promotion Services (Pakistan) Limited Rs.612 million, m/s Hashwani Hotels Limited Rs.540 million, M/s Unique Trading Company Rs.510 million, M/s A.A. Enterprises Rs.410 million and Pace Pakistan Limited Rs.400 million.

The second phase of the bidding round invited the three highest bidders to increase the highest offer with a minimum increment of Rs.5 million or it's multiple thereof. Both the runner up parties announced to withdraw from the competition, which enabled M/s 4 B Marketing to be declared as the highest bidder.

Later, the Board of Privatisation Commission in its meeting recommended the highest offer received from M/s 4 B Marketing for approval of the Cabinet Committee on Privatisation (CCOP), which is meeting shortly. After approval from CCOP the bidder will be declared as successful and Letter of Intent (LOI) will be issued to him for making the payment within a period of 30 days.

Addressing on this occasion Dr. Abdul Hafeez Shaikh said that the completion of a stuck transaction for years through a transparent process would send a strong signal for the other upcoming transactions.

Faletti's Hotel, Lahore was offered for sale on 'as is where is' basis to those parties who are interested in establishing/ maintaining it a quality hotel of international repute within reasonable timeframe while ensuring that the new design of the Hotel will be in harmony with the existing architecture and preservation of its historic identity.

PC received 43 Expression of Interests from the interested parties in response to the invitation to the investors for this transaction while seven bidders deposited Earnest Money of Rs.30 million each within the stipulated period with the Privatisation Commission for becoming eligible to participate in the bidding process.

The Minister termed the transaction as a historic one, which was participated by excellent set of potential investors and further stated that the investors were coming forward in a big way to take part in the privatisation program. The revival of dead units like Associated Cement Rohri, Kohinoor Oil Mills, Hyatt Regency Karachi Hotel Project building and now Faletti's Hotel would generate economic activity, he added.

Referring to the upcoming transactions Dr. Hafeez Shaikh said that for transferring the benefit of privatisation to the common man PC was all set to open subscription of the Secondary Public Offering of GoP shares in Pakistan Airlines (PIAC) from June 7 to June 9, 2004 with a particular focus to give preference to smaller applications for a minimum of 500 shares with a minimum investment of Rs.10000/= only at the rate of Rs.20 per share. The Initial Public Offering of Pakistan Petroleum Limited (PPL) and Kot Adu Power Company (KAPCO) would follow in June and July respectively, he stated.

He further stated that the privatisation process of Pakarab Fertilizers, National Investment Trust, Faisalabad Electric Supply Company (FESCO), Jamshoro Power Company (JPC) and Karachi Electric Supply Corporation was moving forward and the first pre-bid meeting for KESC was being held at Islamabad on May 8, 2004. PC intended to maintain the momentum and further accelerate the pace of privatisation with utmost care and transparency, he added.

The representatives of the highest and the runner up bidders lauded the privatisation process of Faletti's Hotel. The Rep; of M/s 4 B Marketing expressed the intentions of his group to build a quality and modern hotel within a period of 36 months.

This prime property has approximately total area of 68 kanals 11 marla 11 sq. ft. It has 44 large residential rooms, banquet hall, restaurant and facilities like tourist office, post office and travel and tour operating agencies. Only those prospective bidders who submitted EOI were allowed to visit the site.