ISLAMABAD: The government and the Pakistan Steel Mills Corporation (PSMC) on Tuesday, through the Privatization Commission, requested expressions of interest (EoIs) from potential investors to work with their management to acquire at least 51 percent or up to 74 percent of the issued share capital of the Steel Corporation in control .

Interested investors were asked to submit the EoIs before September 30th.

With the aim of revitalizing the steel mill, as approved by the federal government, the PSMC has established a wholly owned limited liability company called Steel Corp. PSMC and Steel Corp have filed a Scheme of Arrangement with the Securities and Exchange Commission of Pakistan for the transfer of core operating assets to Steel Corp, which means that the steel mill and power plant, supporting infrastructure and works, and other things Material assets for which Steel Corp will issue its shares to the Government of Pakistan.

The PSMC re-evaluated the core operating assets, including the steel mill, at fair value reported in the PSMC financial statements for the period ending December 2020, the PSMC, which houses the core operating assets, including the steel mill, and is expected to increase production capacity increase to up to 3 million tons per year.

The plant has a planned production capacity of 1.1 million tons per year

Pakistan Steel Mills Corporation, a privately owned public company wholly owned by the government, is the largest integrated steel mill in the country with a projected annual production capacity of 1.1 million.

The PSMC core land is leased to Steel Corp under a land lease on market terms. The draft of the land lease agreement including the terms and conditions will be made available to prequalified bidders as part of the tender documents for review and comment. The land lease agreement is concluded before the bidding process.

The existing electricity and gas connections as well as the electricity generation license will be transferred to Steel Corp without any encumbrance. Domestic gas or regasified liquefied natural gas availability for Steel Corp is confirmed by Sui Southern Gas Company at applicable rates.

Meanwhile, the Pakistan Steel Mills Corporation advocacy group has asked the government to review the process of inviting EoIs before dismissing the review motion and pending illegal dismissal process of PSM workers.

Memrez Khan, advocate of privatization issues from 2005-2021. The 2005-2021 “process” created negative costs for PPPs and cost more than $ 12 billion over 16 years.

The representative delegation from the PSMC stakeholder group would be available to the government to revitalize the steel mills with local human and financial resources.

Mr. Khan stated in his letter to the Ministry of Industry and Production that PSM is another target of a non-transparent privatization process. Instead of appointing a financial advisor of international repute fairly and transparently, the privatization commission has appointed a consortium of several organizations as transaction advisors who are controversial for this transaction and others have no experience in advising high-tech projects like PSM, he said.

Published in Dawn, September 1, 2021