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ISLAMABAD: The Privatisation Commission (PC) Tuesday held a pre-bid meeting of Heavy Electrical Complex (HEC) under the chairmanship of Federal Minister for Privatisation Mohammedmian Soomro via Zoom. The meeting was attended by senior officials of the PC, financial advisors and the HEC representatives and pre-qualified bidders.

The meeting is held in the backdrop of forthcoming bidding for privatisation of the HEC, the officials from PC and Financial Advisors Consortium responded to the queries of the pre-qualified bidder.

The queries were mainly regarding instructions to bidders document (ITB) and Share Purchase Agreement (SPA) regarding the privatisation of the HEC. Moreover, the data/information for buyers' side due diligence has been uploaded since last three months on Virtual Data Room (VDR) and information for the potential investors has been uploaded after proper verification.

In the meeting, briefing was given to the bidders on the bidding process and Share Purchase Agreement. During the meeting, questions were related to technical, financial, HR and legal aspects of entity being privatised.

The questions were addressed by the concerned director general, transaction manager and FA consortium and legal consultants. The pre-bidding meeting will now be followed by the submission of reserved price for final bidding by the FA Consortium; which will be considered/recommended by PC Board for final approval of the CCoP and the Federal Cabinet respectively.

On few pending matters, the bidders were assured that these matters are being closely followed with the Ministry of Industries and Production (MOIP) being the administrative ministry of the HEC. It is expected those will be resolved very shortly.

Privatisation is a very complex process involving various steps including the seller and buyer due diligence, evaluation and valuations. The entities being privatised are often loss-making and have various encumbrances attached which have to be removed to enable the completion of privatisation process.

The whole process took almost 1.5 years for the PC to bring this entity at this stage pre-bid meeting after addressing various encumbrances related to employees, land, DISCOS and KPEZDMC.

It is expected that the privatisation of the HEC will boost the investors' confidence in the transparency of the privatisation program. This will also create conducive environment for upcoming larger size privatisations including Guddu Power Plant, RNLG plants and will also boost private sector participation; planned in DISCOs.

Copyright Business Recorder, 2021

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