Pakistan's privatization body said on Saturday, May 12, it had received an Expression of Interest (EoI) from Egypt's Orascom Telecom for the sale of 26 percent stake in Pakistan Telecommunication Company Ltd.
"Orascom Telecom, a leading telecommunication company based in Egypt, became the first party to formally submit its expression of interest for the privatization of PTCL," said a statement issued by state Privatization Commission.
Pakistan, which intended to sell a 26 percent stake in PTCL by the end of the year, invited EoIs from investors in April. It sets June 30, 2001 as the last date for submission of EoIs.
The strategic investors would have management control.
Investment bank Goldman Sachs International is the financial adviser of Pakistan's privatization body on the PTCL sell-off.
PTCL was partially listed in 1994 at the stock exchanges, when the government sold three percent of its stake to the domestic market, while a further nine percent was sold on the international market in the form of global depository receipts. Its market capitalization is currently about $1.8 billion.
The commission said Orascom Telecom is a full service provider and currently the largest cellular phone provider in the Middle East and Africa, in terms of licenses and operations.
PTCL's monopoly on land lines and international circuits runs out at the end of 2002, opening the country up for competition — an incentive to continue the privatization process despite weak market conditions for shares in telecoms companies.
At present mobile phone companies are the only operators of privately owned telephone businesses in Pakistan. PTCL is the most important of the companies that the military government of General Pervez Musharraf has earmarked for privatizations. It was converted into a publicly listed company in 1996 in preparation for privatization.
The company has over 3.2 million telephone lines in service and also owns Internet and mobile phone services that would be remain part of PTCL. PTCL's profits for the first nine months (July-March) during current fiscal year were put at 12.298 billion rupees ($200.4 million), compared with 12.012 billion rupees ($195.8 million) in same period last year. — (Reuters, Karachi)
© Reuters 2001
© 2001 Mena Report (www.menareport.com)