NA STANDING COMMITTEE ON PRIVATISATION BRIEFED ON FALETTI 'S HOTEL AND ABL PRIVATISATION

Islamabad, December 23, 2004

National Assembly Standing Committee on Privatisation met under the chairmanship of Syed Mohammad Asghar Shah, MNA in the Parliament House, this morning to discuss the privatisation of Faletti's Hotel, Lahore and Allied Bank Limited.

Dr. Abdul Hafeez Shaikh Federal Minister for Privatisation & Investment briefed the Committee on the privatisation of Faletti's Hotel Lahore and informed that the successful bidder was being fully assisted in executing his investment program to build a quality hotel of international standard on the site.

The Secretary Privatisation Commission Mr. Jehangir Bashar informed the Committee that during the three previous attempts to privatise the Hotel, no restrictions were imposed on the bidders for utilization of the said land for any other purpose; however, none of them could succeed due to low offer or for not depositing the bid money. While the final attempt included condition to build quality hotel only, which was participated by leading quality player of world repute and Privatisation Commission received offer of Rs1.2 billion much above the reference price and all the previous offers. Syed Muhammad Asghar Shah asked the Privatisation Commission to display its ongoing and upcoming transactions on the international web sites for reaching the serious and quality investors.

While reviewing the status of Allied Bank Limited, the representative of State Bank of Pakistan, informed the Committee that the process was not privatisation rather it was restructuring of the Bank. The Allied Bank Limited was given to Allied Management Group in the year 1991 through privatisation process at the rate of Rs.70/- per share for initial offer of 26 % shares and additional offer of 25 % shares on the same rate. The employees later started selling their shares in 1997 and at one stage there were only 8 % shares left with the employees and the Bank's equity got negative. Such circumstances demanded State Bank of Pakistan to intervene and play its role as regulator. The whole process was advertised and after fulfilling all the requirements, the management of ABL was transferred to the successful bidder. The Committee, however, decided to invite Governor State Bank of Pakistan and Chairman ABL in its next meeting to discuss the issue in detail.

The meeting was attended by Dr. Abdul Hafeez Shaikh Federal Minister for Privatisation & Investment, Mr. Umar Ahmad Ghumman Minister of State for Privatisation & Investment, MNA's Ch. Haroon Qaiser, Malik Ghulam Murtaza Maitla, Ms. Gul-e-Farkhanda, Dewan Jafar Hussain Bokhari, Khawaja Mohammad Asif, Maulana Asadullah, Mr. Ghulam Mustafa Shah, Senior officials of PC and SBP.