ISLAMABAD, July 7: Saudi Pak Agricultural and Industrial Investment Company is likely to be soon converted into a public limited company with a view to have an access to the capital market.

Informed sources told Dawn on Friday that the Annual General Meeting (AGM) of the Saudi Pak, held recently, has approved its plan to go public which will help it to further strengthen its resource base.

A decision has been taken to get the proposed Saudi Pak public limited company enlisted on the stock exchanges of the country.

The company will make an initial public offering (IPO) after having been formally converted into a public limited company.

Sources also said that both the governments of Saudi Arabia and Pakistan have also approved the setting up of a Saudi Pak Real Estate Development Company. A number of international companies from China, United Arab Emirates (UAE) and Malaysia have expressed their willingness to enter into joint venture with Saudi Pak by substantially investing in the real estate sector of Pakistan.

Pakistan's central bank, sources said, was currently processing the establishing of Saudi Pak Real Estate Company and was expected to shortly accord its approval.

The new company will finance infrastructure projects and housing schemes in the country. It will also provide funding for the development of new tourist spots, shopping malls, hotels and office blocks.

The new company will have a complete corporate and management structure for promoting long-term investment horizon in Pakistan for which necessary regulatory approval of the Securities and Exchange Commission of Pakistan (SECP) was also being sought.

All the necessary spade work relating to the setting up of the real estate development company had been completed, and according to the sources, as soon as the formal approval was granted its activities would start in all the four provinces and in Azad Kashmir.

The board of the directors of the Saudi Pak had approved an initial capital of Rs500m for the real estate development company.

"This will be a first ever organised company to cater to the huge requirements of housing, infrastructure etc., in Pakistan,” a source said, adding that the new company will offer significant loaning to help meet the housing and other related requirements.

Saudi Pak Investment Company has made new approvals worth Rs4.7bn during the first six months of the current calendar year against Rs3.3bn of the same period last year. Likewise its disbursements were to the tune of Rs3.4bn by June 2006 against Rs2.4bn of the corresponding period of 2005. The company made a recovery of Rs2.5bn in first six months of 2006 against Rs2.2bn of the same period last year.