ISLAMABAD, June 6: The Cabinet Committee on Privatization (CCoP) here on Thursday approved the transaction structure for the privatization of United Bank Limited (UBL).

This will be the first major transaction in the financial sector being disinvested by the present government. UBL transaction is being handled by the Financial Adviser Societe General & AMZ Securities.

According to a PC announcement, the bidding for UBL will take place on June 10 at the Privatization Commission.

The three pre-qualified bidders, Consortium of Abu Dhabi Group (UAE) & Bestway Holding Limited (UK) c/o Bank Alfalah Limited, the Consortium of Muslim Commercial Bank and Associates and the Consortium of Union Bank Limited and Associates, will take part in the bidding.

A pre-bid meeting for the privatization of the United Bank Limited (UBL) was held on April 18 which took a number of decisions to significantly improving Bank’s valuation, which include provision of a level-playing field to all the bidders and removal the chances of speculative bidding.

It was decided to off-load 51 per cent shares of the UBL along with the transfer of management to a strategic buyer.

It was also decided to issue bonds on competitive terms and conditions to settle the tax refund claim liability for all the banks.

According to the decision, the UBL will receive bonds worth Rs5.4 billion against its tax refund claim. It was agreed that the decision of the government to extend the time limit for carrying forward deferred tax assets for the nationalized commercial banks, including UBL, through an appropriate amendment in the law will help them to seek better price from the local and foreign investors. This will allow UBL to carry forward deferred tax assets of Rs8.3 billion for the extended period.

After the bidding of UBL, the privatization of Habib Bank Limited (HBL) will be undertaken on a fast track basis, which has already been launched and targeted for bidding in September this year.

The CCoP approved the highest offer of Rs110 million for Al- Haroon Chambers, Karachi given by Mian Parvaiz Akhtar of New Allied Electronics Indus (Pvt) Ltd and rejected the offer of Rs 360 million for Faletti’s Hotel, Lahore made by Afzal Motors being below the acceptable price.

The meeting chaired by Minister for Finance Shaukat Aziz was also attended by the ministers for communications, labour, privatization, deputy chairman Planning Commission, Chairman Board of Investment (BOI), Secretary General Ministry of Finance and other senior officials.