ISLAMABAD: The Privatisation Board on Wednesday approved to increase the divestment of Oil and Gas Development Company Ltd (OGDCL) shares in the capital market from 7 per cent to 10 per cent on the recommendation of the ministry of energy.

The final approval will now be given by the Cabinet Committee on Privatisation (CCoP) which had earlier given the approval of 7 per cent. The increase in shares would attract investment from international exploration and production companies in OGDCL, the ministry believes.

The board meeting, chaired by Minister for Privatisation, Muhammad Mian Soomro, also gave due consideration to the recent stability of crude oil prices in international markets, share price trends of OGDCL and its higher dividend yield ratio.

The divestment of 10pc government shares in Pakistan Petroleum is also on hold due to downward trend in international oil prices. The board decided that the shares in PPL would be offered in the capital market.

The board members were of the view that the divestment of government shares in OGDCL and PPL should not be offered as block sale, rather it should follow one after another.

Jinnah Convention Centre is likely to be the first case of privatisation by the present government. It is among the ten public sector entities which have been targeted for divestment subject to resumption of economic activities and improvement in market conditions once the pandemic situation is improved. The target has been set for December.

The Privatisation Board considered the legal and other impending issues in divestment of Pakistan Engineering Company Ltd (PECO) and deferred further action till August 20, keeping in view the commitments of resolution of the Ministry of Industries and Production given in the meeting last week.

It also approved new directions and guiding rules for transaction managers under the Privatisation Commission Ordinance.

These guidelines will help transaction consultants in carrying out their responsibilities in a better manner.

The board was informed about the status of appointment and hiring of financial advisers on part of Ministry of Privatisation in light of the cabinet decision.

Soomro urged that the matters regarding subject transactions should be completed steadily to avoid unnecessary delay in their completion. The resultant cash flow will help the government in debt retirement, he added.

Published in Dawn, July 30th, 2020