ISLAMABAD - Privatisation Commission (PC) Board on Tuesday endorsed the bidding price of Heavy Electrical Complex (HEC).

An important Board meeting of the Privatisation Commission was held Tuesday under the chairmanship of Chairman PC Saleem Ahmed. Federal Minister Mohammedmian Soomro, Federal Secretary, Board members, Financial Advisors (FAs) and senior officials of the Ministry of Privatisation attended the meeting.

The PC Board deliberated over one-point agenda regarding the approval of bidder and bidding price of Heavy Electrical Complex (HEC). The bidding took place Monday, and IMS Engineering Private Limited succeeded by offering the highest bid of PKR 99.999 per share, which is higher than the reserved price, while Waves-Singer and PEL came second and third respectively. The Board members were apprised that Cabinet Committee on Privatisation (CCoP) endorsed the reference price of 98.23% per share for HEC which was followed by the bidding. The Board members welcomed the price offered by the successful bidder as it is higher than the reference price and hence unanimously endorsed the bidder and bidding price for the entity; it also recommended that the same may be placed before CCoP and Federal Cabinet for timely completion of the transaction.

Federal minister said that the CCoP deliberated upon the issues relating to liabilities which will pass on the new buyer, while employees related liabilities would not pass on the new buyer and would be considered by the parent body.

With the highest bid price of Rs. 99.999 per share from IMS Engineering, HEC’s enterprise value is estimated to be around Rs. 1.900 billion. Valued as a going concern, reserve price was based on extensive diligence and financial modeling that incorporated demand outlook and supply constraints, and was approved by CCOP earlier in the day.

Privatisation Commission (PC) successfully conducted the bidding for privatisation of Heavy Electrical Complex (HEC), the first entity-level strategic transaction since 2015. As per the transaction structure approved by Federal Cabinet in December 2020, all 96.6% Government shares in HEC were offered for sale. This was the fifth attempt at privatizing HEC with prior unsuccessful efforts in 2006, 2011, 2013 and 2015.