Govt to send top officials to US to find consultants for Roosevelt Hotel privatisation deal

A summary has been submitted for Prime Minister Shehbaz Sharif’s approval, seeking authorisation for a delegation from the Privatisation Commission to visit the United States from August 20th to 24th. The delegation, comprising the Advisor to the Prime Minister on Privatisation and the Secretary of Privatisation, will search for consultants for the Roosevelt Hotel’s privatisation, according to a news report.  

The trip is expected to cost approximately Rs3 million.

Meetings with several potential financial advisors, including CitiBank, CBRE, Savills, and others, have been scheduled for the visit. 

This move marks a shift from traditional methods, as government delegations typically travel abroad to engage with potential buyers of assets, not to secure financial advisors. 

The government has already placed advertisements in local and international media, seeking expressions of interest from new financial advisors by September 2. This follows the resignation of the previous advisor due to a conflict of interest.

The Roosevelt Hotel, currently owned by the Pakistan International Airlines (PIA), is slated for privatisation. Pakistan had previously engaged an American firm for the privatisation at a cost of Rs2.2 billion, of which Rs1.1 billion was already paid. However, the firm abandoned the project last month, citing a conflict of interest, and has agreed to return the payments.

The government has already approved the transaction structure for the Roosevelt Hotel, which includes the joint venture model with multiple options. This structure is designed to maximise long-term value while providing flexibility, multiple exit opportunities, and minimising future fiscal exposure. The government now aims to reassure prospective advisors that much of the groundwork has already been completed.

The Roosevelt Hotel’s land value, including the 32-storey building, will be part of the joint venture’s contribution, and the government is not expected to provide additional funds.

The government aims to ensure that the joint venture option, though high-risk, will provide the highest net proceeds for Pakistan, according to the financial advisor’s report.