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All arrangements have been finalised to hold bidding for a 75% strategic
Stake in Pakistan Steel Mills Corporation (PSMC) in Islamabad on Friday (March
31, 2006). Two bidder consortiums deposited earnest money of US $ 30 million
each within the stipulated time.
Nine parties had been prequalified out of which 8 conducted active due
diligence. Out of these five parties attended the pre-bid meeting. Six
pre-qualified parties have joined to formtwo strong bidding consortiums. The
Participating consortiums include (i) M Magnitogorsk Iron & Steel Works Open
JSC (Russia), TuwairqiSteel Mills (Saudi Arabia) and Arif Habib Securities and
(ii) Noor Financial (Kuwait), Industrial Union of Donbass (Ukraine),
Government of Ras Al Khaimah and Al-Jomaih Holdings (Saudi Arabia).
The bidding will be held in the presence of the representatives of print and
electronic media. The pre-qualified parties have completed their due diligence
of the transaction including plant visits and physical / virtual data room.
PSMC is the country's largest and only integrated steel manufacturing plant,
with an annual designed production capacity of 1.1 million tonnes. It was
incorporated as a private limited company in 1968 and commenced full-scale
commercial operations in 1984. PSMC Complex includes coke oven batteries, a
sintering plant, blast furnaces, steel converters, bloom and slab casters,
billet mill, hot and cold rolling mills, galvanizing unit and 165 MW of own
power generation units, supported by various other ancillary units. It is
located 40 km south east of the coastal city of Karachi, in close proximity to
Port Bin Qasim, with access to a dedicated jetty, which facilitates import of
raw materials, PSMC manufactures a wide mix of products, which includes both
flat and long products, PSMC effectively enjoys a captive domestic market due
to the prevalent demand-supply imbalance in the country's steel
industry, where demand has historically exceeded local
supply.