KARACHI: The last date for submission of Expressions of Interest (EoI) in acquisition of 40 per cent strategic shares in Pakistan Stock Exchange (PSX) has been extended to Aug 14.

The earlier date stipulated in a public invitation released a month ago was June 29.

Following the demutualisation of the stock exchanges in the country, the Securities and Exchange Commission of Pakistan (SECP) is offering to ‘eligible investors’ 40pc shares, out of the 60pc currently held in demutualised form in blocked account with the Central Depository Company.

The strategic investment would include management control of the PSX core operations.

According to the regulations, an eligible investor could be a strategic investor; ‘anchor’ investor or financial institution.

The new regulation introduces the concept of ‘anchor investor’, which could be a financial institution (FI) or strategic investor, who acquires at least 25pc shares of the exchange.

Two or more financial institutions and strategic investors could form a consortium to submit a joint EoI.

A single financial institution would not be allowed to acquire or hold more than five per cent shares of PSX unless it opts to act as an ‘anchor investor’. After an initial period of three years, the ‘anchor’ investor may increase its shareholding to 51pc of the total issued share capital of PSX.

The anchor investor would be required to maintain its equity holding in PSX for at least five years, after which it can sell stake to another anchor investor.

Nadeem Naqvi, managing director of PSX said on Friday that interest was shown in acquisition of strategic shares by some international global funds as well as stock exchanges.

He said that the interested parties were in talks with the PSX.

“We are in the process of answering queries and evaluating the buyer,” he said.

SECP Commissioner of Sec­urities (Market Division), Mohammad Atif Malik said that the invitation for EoI was submitted by the divestment committee of PSX.

He said that after the receipt of EoI, the exchange would forward it to SECP for evaluation and approval.

Atif affirmed that “interest is there” in buyout of strategic shares, but beyond that he was not prepared to name names of parties, which may have expressed such an interest.

The commissioner SMD of SECP said: “Our interest is in assuring quality divestment.”

He affirmed that road-shows would be held in other regional and developed markets after Ramazan.

So if in the next two-and-half months, PSX does not receive quality EoIs would the process drag on? Atif denied that it would.

He elaborated that according to the regulations released in February this year, PSX has six months to find a strategic investor, after which there would be another three months of grace period.

He hoped that the process would be completed by the winter this year.

Published in Dawn, July 1st, 2016