ISLAMABAD: IMS Engineering Pvt Ltd on Monday offered Rs99.99 per share or Rs1.9 billion to buy the state-run Heavy Electrical Complex (HEC).

An open bidding process for the divestment of 14.10 million shares (96.6 per cent) of HEC was held in which the Karachi-based firm was declared successful by the Privatisation Commission.

Valued as a going concern, the reserve price was based on extensive diligence and financial modeling that incorporated demand outlook and supply constraints, and was approved by Cabinet Committee on Privatisation (CCoP) earlier in the day.

The PC Board will meet on Tuesday to discuss the outcome and recommend the transaction to the CCoP for its approval before it is presented for the federal cabinet’s consideration.

The privatisation of HEC is the first entity-level strategic transaction since 2015. This was the fifth attempt at privatising HEC following unsuccessful efforts in 2006, 2011, 2013 and 2015. As per the transaction structure approved by the federal cabinet in December 2020, all 96.6pc government shares in HEC were offered for sale.

As per the procedure, the outcome of the bidding will now be submitted to the CCoP after recommendations made by the PC Board concerning the bidding price which is said to be above the reserve price.

The other two bidders were Waves-Singer Pakistan Ltd and Pak Elektron Ltd (PEL) which offered Rs26.250 and Rs17.731 per share, respectively.

According to PC, six parties had reached the pre-qualified stage, however, only three bidders deposited the earnest amount and participated in the open bidding.

Published in Dawn, February 22nd, 2022