ISLAMABAD: The Cabinet Committee on Privatisation (CCoP) directed the Privatisation Commission on Thursday to appoint a financial adviser to start the process of transaction of the Roosevelt Hotel in New York.
The CCoP decision will now be considered by the federal cabinet on Tuesday next week and, if approved, the Privatisation Commission would start the process of hiring a financial adviser for transaction of the Roosevelt Hotel owned by the Pakistan International Airlines.
The transaction structure of the Roosevelt Hotel has now been added to the government’s active privatisation programme, which currently has 18 entities with specific timelines for privatisation.
Privatisation Secretary Rizwan Malik told Dawn that the entire process from the hiring of a financial adviser to the completion of transaction might take 18 months to two years. He said the operation of the Roosevelt Hotel on a joint venture basis would generate revenue for the PIA, while the ownership of the asset would remain unchanged.
Cabinet body denotifies Roosevelt task force constituted in November last year
“The joint venture operation is one of the eight modes under the privatisation ordinance and the purpose is to gain the best value, and it will not be a sell-off mode,” he added.
The CCoP decision fully empowered the Privatisation Commission to start the transaction process under the Privatisation Commission Ordinance, 2000. According to sources, proposals for engaging the Board of Investment and the aviation division in the transaction process were opposed by most of the CCoP members who insisted that the process should be exclusively handled by the Privatisation Commission.
According to a press release, a meeting of the CCoP presided over by Adviser to the Prime Minister on Finance and Revenue Abdul Hafeez Shaikh reviewed the one-point agenda of privatisation of Roosevelt Hotel asset owned by PIA-Investment Limited.
The CCoP, on the request of the aviation division, decided to denotify the Roosevelt Task Force, which was constituted in November 2019 under the chairmanship of the minister for privatisation to examine and process all necessary formalities for an early disposal of the PIA properties, including Roosevelt Hotel in New York and Hotel Scribe in Paris.
The task force also had the mandate for framing terms of reference for leasing the Roosevelt’s site for setting up of a joint venture project.
The CCoP directed the Privatisation Commission to hire the financial adviser to start the process of transaction in the light of a report prepared by M/s Deloitte in July 2019, which had recommended that “the highest and best use of the Roosevelt Hotel property is to redevelop the site into a mixed use through joint venture of primarily office tower over retail and condominium”.
The CCoP also directed M/s Deloitte to update its study on the hotel transaction over the next four weeks and share the same with the committee.
The meeting was attended by Privatisation Minister Muhammadmian Soomro, Planning and Development Minister Asad Umer, Adviser to the PM on Commerce, Textiles and Investment Razak Dawood and Special Assistant to the PM on Overseas Pakistanis and Human Resource Development Syed Zulfiqar Abbas Bokhari, besides senior officials of the ministries concerned.
Published in Dawn, July 3rd, 2020