State Minister for Privatization Muhammad Zubair Friday clarified that the government was not privatising the Oil and Gas Development Company (OGDCL) as divesting some of the company’s shares could not be termed as privatisation.
Addressing a press conference here, the minister said the government would still be the majority shareholder even after off-loading 10 per cent shares, so the structure of the company would remain intact and no employee would be sacked.
He said the government had currently 75 per cent shares in the OGDCL out of which only 10 per cent shares were being off-loaded through capital market.
The minister said there would be no further off-loading of the OGDCL shares except the forthcoming transaction. He said out of 322 million shares for sale, 311 million would be offered to institutional investors while out of the remaining 11 million shares, two-thirds would be offered to general public and one-third to the OGDCL employees.
The minister of state dispelled the impression that the OGDCL shares were being divested without any legal authority clarifying that the Supreme Court of Pakistan had allowed the government last month to proceed with the transaction.
He also denied that the transaction was being done on the direction of International Monetary Fund (IMF). He said a comprehensive and transparent procedure was followed in the divestment of OGDCL shares as approval to this transaction was given in January 2014 which was followed by the appointment of a financial advertiser through public advertisement and then the Board of Directors.
He said questions raised by some political parties were not justified as these parties did not point finger when shares of UBL and PPL were divested on same pattern earlier this year.
He said the Pakistan People’s Party privatised as many as 27 public entities during its tenure from 1993-96. So, when the PPP followed the privatisation policy, why it was against the divestment of some shares by the current government, he questioned.
The minister said the employees of OGDCL could become major beneficiaries of this divestment as they had an opportunity to purchase shares of the company on cheaper rates.
He said the federal government was ready to address all the concerns of employees of the company and was ready to meet the union leaders to clarify their misconceptions.
The minister said the entire process was planned to be completed in September 2014 but it was delayed due to political situation. Meanwhile, international oil and gas prices reduced and consequently the OGDCL share prices were also reduced from Rs 250 per share to Rs 227 per share.
He said although the reduction in oil prices would have positive impact on the country’s overall economic situation, however, it reduced the estimated income from $830 million from OGDCL shares to $700 million.
