PC aiming to recover Rs4b from defaulters of SOEs buyers

The dues amounting to Rs4 billion are outstanding for fourteen privatisation transactions respectively

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ISLAMABAD: The Privatisation Commission Board on Tuesday has decided to reach out to investigative agencies for the retrieval of Rs4 billion outstanding dues owed by defaulting buyers of state-owned enterprises (SOEs).

The board headed by Privatisation Minister Muhammad Mian Soomro has also constituted a committee to decide a plan by mid of December to recover the dues in such cases, reports Express Tribune.

After the failure at all previous attempts to retrieve the outstanding dues, PC board has decided to go after them.

Currently, the dues amounting to Rs4 billion are outstanding for fourteen privatisation transactions respectively.

Also, Mr Soomro instructed the committee to make all efforts to ensure recovery of the outstanding amount from the buyers of the SOEs which were privatized in the 1990’s, as per a handout issued after the conclusion of the board meeting.

Roughly Rs3.94 billion is to be retrieved from these defaulting buyers of several enterprises, the handout said.

And the Chairman instructed to reach out to appropriate investigative bodies to investigate the truth and resolve the problem, said the commission.

Sources in the commission revealed the Privatisation Commission had recently suspended one of its officials who was accused of conniving with a private party.

The amount due included the balanced sale price, loans and advances by the governments to these sold SOEs and interest charges on delayed payments.

From the Rs4 billion outstanding, the balanced sale price is Rs1.2 billion including principal amount of Rs120.3 million.

A major share of Rs2 billion was owed on account of advance loans extended to these SOEs. And the dues are owed in 14 cases, however, the commission has sought the guidance of Privatisation Commission in only half a dozen cases.

According to sources, the commission told the board that Rs526 million were owed against Schon Group on account of sale proceeds of Pak China Fertilizer Limited, National Fibers Limited and Quaidabad Woolen Mills Limited.

In 2016, the Privatisation Commission board had given go-ahead to a settlement plan, however, it wasn’t executed, said sources.

Finally, in January this year, the Privatisation Commission forwarded final notices notifying all defaulters for payment of all outstanding dues.

The officials said, Schon Group had expressed an inclination to pay off the outstanding amount in instalments, however, no settlement could be reached.

According to details available, Crescent Factories Vegetable Ghee Mills was sold to Javed Rafi of SJ Industries at a price of Rs63 million in 1993.

However, because of the non-payment of the principal amount of Rs20 million, Rs94.8 million are still owed by SJ Industries.

The buyer agreed to pay the outstanding amount last month, however, the issue remained unresolved after it asked for the taking back of the recovery suit, said sources.

In lieu of Pioneer Steel Limited, its buyer Mohammad Osman still owed Rs260.2 million balance since its privatisation 26 years ago, the commission apprised the board.

Already, the Privatisation Commission is fighting a case against the buyer and a recovery suit filed in 2008 was dismissed by the Islamabad High Court in 2016.

The sources said the court had instructed the commission to give a chance to hear out the buyer, however, the matter remains pending.

In the case of privatisation of Haripur Vegetable Oil processing industries which happened in 1992, an amount of Rs117.8 million is owed by Malik Naseer and Associates.

The sources shared the board has constituted a committee of officials from the private sector and the commission to find a solution in all these six cases.

Aside from this, outstanding amounts are also owed in eight other cases which include Reyaz Shaffi owes Rs147.4 million in Pak PVC company privatisation case.

Rs129.2 million were outstanding on part of Sindh Alkalis EMG in its privatisation and Bibojee Services Private Limited owes Rs31 million in the case of National Motors Privatisation to the government.

Rs73.7 million are owed in the case of Balochistan Wheels privatisation by the Tawakkal Group and Awan National Cement hasn’t paid Rs57.2 million in National Cement Dandot privatisation.

Also, Rs50.2 million were owed in case of Haripur Vegetable Ghee case privatisation, the sources said.

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