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With an improving macro economic environment, the Government of Pakistan
("GOP") has reiterated its commitment to privatise Pakistan State Oil Company
Limited ("PSO") by selling 51% equity stake in PSO, together with management
control, to a qualified strategic investor. Dr. Abdul Hafeez Shaikh Federal
Minister for Privatisation & Investment announced in a statement issued here
today.
He said that quality players have shown their keen interest during their
visits to explore investment opportunities in Pakistan and it was expected
that the fresh invitation for PSO privatisation would generate interest around
the globe and would give impetuous to Pakistan's Privatisation Program and
would further accelerate the pace of privatisation of mega public sector
entities.
Dr. Hafeez Shaikh further stated that all stakeholders have been taken into
confidence before taking the PSO transaction to the market while the bidding
for Karachi Electric Supply Company (KESC) would take place on February 4,
2005 and Pakarab Fertilizers Limited was also approaching the bidding point.
29 EOIs received recently for National Refinery Limited was also an
encouraging sign as regard to interest shown by local and foreign investors in
the country's Privatisation Program, he added.
The Minister said that Government of Pakistan has also implemented substantial
sectoral reforms towards the deregulation of the petroleum sector. This was
being done with a view to attract foreign investment and to achieve cost
efficiency and quality services at competitive prices, he stated.
The Privatisation Commission has asked the investors interested in joining the
process of PSO privatisation to submit an EOI at the earliest. Upon receiving
the EOI and processing fee, a Request for Statement of Qualifications ("RSOQ")
will be sent immediately. Early submission of EOIs
will allow parties maximum time to complete their RSOQ requirements. They are
also required to give the details regarding the Name of Company/Group and
their background information, Experience in the Petroleum Sector, Experience
in oil transmission, distribution/marketing and management of
OMCs,, Audited Financial Account Statements for the preceding three years; and
details of ownership/group structure, accompanied with a non-refundable
processing fee of US$5,000 or PKR 300,000. Last date for submission of
Statement of Qualification by all interested parties is March 4, 2005 while
bidding is expected in June 2005. JPMorgan is advising the PC on the sale.
Those parties who have earlier shown interest in the transaction have been
asked to reiterate their interest.
PSO is the largest oil marketing company ("OMC") in Pakistan and is engaged in
the storage, distribution and marketing of petroleum products, Liquid
Petroleum Gas, Compressed Natural Gas and petrochemicals. As of 30 June
2004, PSO has more than 3,800 retail outlets spread across the country with
over 60% market share in POL products sold. PSO's total storage capacity of
approximately 860,000 metric tones accounts for 81% of total national storage.
PSO serves a broad customer base throughout the country including the retail,
industrial, aviation, marine and Government/Armed Forces sectors. PSO's
financial summary is as follows:
Financial statistics (PKR) FY 2001 FY 2002 FY
2003 FY 2004 Gross Sales 195,039 182,323 206,376 195,110
Operating Profit 4,004 4,567 6,205 6,095
Profit After Taxation 2,251 3,188 4,030 4,212
Total Assets 30,137 32,793 32,338 42,409
Total Equity 9,808 11,253 13,063 14,160
Avg. Exchange Rate: US$1 = PKR 58.44 61.43 58.50 57.57
Note: All figures in millions