JP Morgan Team Calls on Privatization Minister to Discuss NPPMCL Sell-off

Buying & Selling

Senior representatives of one of the world’s largest investment banks, JP Morgan Chase & Co., called on Federal Minister for Privatization, Mohammed Mian Soomro, to discuss privatization of the National Power Parks Management Company (NPPMCL) on Monday.

The meeting was held in the backdrop of the government’s plans to privatize two regasified liquified natural gas (RLNG) power plants of Haveli Bahadur Shah and Balloki.

It is to note that the government has initiated a process of implementing economic reforms in the power sector. As a part of the reforms, the Ministry of Privatization is seeking to privatize various state-owned entities to enhance capital formation outside the government budget and to improve efficiency through competition, accountability, managerial autonomy, and profit incentives.

The process of privatization of two RLNG plants was slowed down due to the COVID-19 pandemic. Twelve parties were prequalified in April 2020. The process restarted after the COVID-19 restrictions were relaxed. At present, the Ministry is pursuing debt-refinancing and recapitalization for NPPMCL, with local banks.

Expressing his views, MD JP Morgan said the consortium of Qatar Investment Authority (QIA) was a strong contender of the said power plants.

The representatives inquired about the current volume of circular debt, payment due to the IPPs, and the huge receivables of NPPMCL, which could have a negative impact on the potential investment in the sector.

Federal Minister Mohammed Mian Soomro said a number of meetings were held with the Ministry of Energy and Finance Division, adding that the local banks and DFIs were considering providing a significant portion of debt for NPPMCL.

The meeting participants were briefed that the Ministry of Privatization had resolved various key issues to make this transaction viable.

Federal Minister hoped that the transaction would be completed in the ongoing fiscal year owing to a strong response from investors.

The delegation included Asif Raza, Managing Director, Global Corporate Bank CEEMEA, Imran Zaidi, Managing Director, Global Corporate Bank MENA, and others. Senior officials of the Ministry also attended the meeting.

 

 

Source: Pro Pakistani