Debts at the time of privatisation: Ex-chairman urges KE to make volume public

ISLAMABAD: Former Chairman Karachi Electric (KE), Ikram Sehgal, has urged the power utility to make public its volume of debts at the time of privatisation and current stock and funds injected into it other than equity by the shareholders.

He raised these questions during discussion at the Forum of 300 comprising Chief Executive Officers (CEOs) and other corporate executives of various companies.

Sehgal maintained that as a former Chairman KE, he can vouch for the company's management as being superb - par excellence - and almost all have great honesty and integrity. However, as corporate executives they suffer from the same problem that besets all corporate executives, whether domestic or multinational: how to balance the interests of the shareholders who employ them with the national and public interest. The East India Company (EIC) was the world's first publicly traded MNC.

"I urge all of you to read Shashi Tharoor's "An Era of Darkness" and William Dalrymple's "The Anarchy" of how the EIC looted and pillaged, first Bengal, and then India , with the active help of locally employed "Munshis"," he said.

Sehgal further stated that ECC's meeting presided over by Hafeez Shaikh on Friday considered a summary pertaining to KE tariffs questioned how one could expect the Advisor on Finance to balance the interests of the people of Karachi with KE's admitted cash flow problems mainly because of additional capital outlays which could have been avoided.

On this, CEO, KE Moonis Alvi said that he agrees. KE is run professionally by a competent team under difficult circumstances but corporate, public and state interests always need to be balanced.

"I will not go into details but a forensic enquiry should reveal how much funds were actually invested by the shareholders other than equity since privatisation, moreover, additional power is and will be available, and NTDC had no business certifying otherwise," he added.

However, replying to Moonis Alvi, former Chairman KE Ikram Sehgal said, "he is a layman and his questions are simple and should not take a finance professional a long time to answer: (1) what was KEs debt on privatisation and what is it now? (2) How much funds other than equity has been injected by the shareholders and in what manner?"

Moonis responded to his remark by saying: "ask your accountant to take it from our financial statements. Accounts were audited by KPMG till 2016 and A F Ferguson since then. I hope you are satisfied by the quality of the audit firms."

KE is a national asset with the majority(Abraaj) of the private equity consortium under liquidation the people of Pakistan holding about 25 percent have a right to know how much has been actually invested by the shareholders and how much debt has been added to KE books since then.

"The accountants are fantastic no problem but respectfully my simple questions can be answered for this forum by you or your CFO or anyone you designate," Sehgal stated.

Copyright Business Recorder, 2020