ISLAMABAD, Sept 14: The Privatization Commission on Wednesday received the highest bid of Rs4.315 billion from Haji Usman and Group to take over 96.34 per cent shares of Javedan Cement Limited (JCL) at the rate of Rs80 per share.
The highest bid could, however, just meet minimum floor price of Rs80 per share fixed by the Privatization Commission. The bid came when the Privatization Minister Dr Abdul Hafeez Sheikh announced that the government could not consider an offer lower than the floor price.
Four parties competed for JCL after depositing Rs75 million as earnest money. These included Al-Munaf Corporation, Haji Ghani Usman and Group, Siddiqsons Denim Mills Limited and Valibhai Kamruddin.
At the start of bidding process, the bidders dropped sealed offers. Al-Munaf Corporation offered Rs33.10 per share (Rs1.785 billion in total) Haji Ghani Usman and Group offered Rs25 per share (Rs1.348 billion), Siddique Sons Denim Mills Limited offered Rs40 per share (Rs2.157 billion) and Valibhai Kamruddin Rs20 per share (Rs1.078 billion).
In the second round, the bidders were asked to raise offer over and above the highest offer of Siddique Sons to make it acceptable to the government. However, no body was ready to go higher than Rs50 per share again offered by Sidique Sons.
The minister gave another chance to the bidders to go up to meet the floor price and Usman Ghani and Group offered to match the floor price of Rs80 per share. Other bidders were given a last chance if they wanted to go beyond this offer but in vain.
At this, the minister announced that the highest offer was above the floor price and was acceptable to the Privatization Commission.
As a first right to the former owners, Valibahi Kamruddin Sindh (Pvt) Limited, was asked to match the highest bid but its representatives declined. The bidding results would be submitted before the High Court of Sindh on September 15.
The minister said that the highest offer of Rs80 per share would be presented before the Privatization Commission board for recommendations to the Cabinet Committee on Privatization (CCoP) for its approval.
Later, talking to the journalists the minister said JCL bidding would bring an efficient company into existence. He termed outcome of the bidding as a good omen for the country’s industrialisation.
The representatives of the bidders showed satisfaction over the bidding process and termed it as transparent. Haji Ghani Usman said that he would take care of the workers and also install a power house of 100mw at JCL’s premises.
The successful bidder is required to pay 25 per cent of the total offer within 15 days after receiving the letter of acceptance (LoA) and remaining 75 per cent in one month.
