Merrill Lynch to manage Pakistan’s UBL overseas sale
Pakistan on Friday appointed a consortium of Merrill Lynch and local KASB Group to manage the global share sale of United Bank Ltd, the country’s third largest bank, Privatisation Minister Zahid Hamid said. He did not give any details of the size and timing of the transaction, saying a decision in this regard would be taken after consultation with the lead managers. But sources familiar with the matter said the government plans to sell a stake worth $200 million to $300 million through a global depository receipt (GDR) sale. The government is only selling part of its roughly 45 percent stake in UBL, and the deal is expected to be completed by the end of June. Hamid said the board of the Privatisation Commission of Pakistan (PC), the body overseeing the sale of government assets, also selected a consortium of Citigroup (C.N: Quote, Profile, Research) and Cushman & Wakefield to manage the sale of Roosevelt Hotel in New York. “We have also selected Global Securities for the initial public offering (IPO) of Habib Bank Ltd.,” he told Reuters. Habib Bank Ltd. is the country’s second-biggest bank, and the government also plans to float its GDR in coming months. Pakistan’s government has been trying to offload part of its stake in UBL since June 2005, when it tried to sell 15 percent through an initial public offering that eventually failed to draw enough subscribers.
A consortium of UAE-based Abu Dhabi Group and British conglomerage Bestway Group bought 51 percent of UBL from the government in 2002. The government was planning a 20 percent stake sale in February 2006, according to a government source, but the deal never made it to the market. Pakistan is being tipped by foreign investment bankers as a potential hotbed of equity issuance activity as the country’s economy is growing at nearly 7 percent and the government is pushing to privatise some of its biggest companies. The country’s largest listed firm, the Oil and Gas Development Co. Ltd. raised $813 million through a GDR sale in December, and the government is also set for a stake sale of top oil marketing firm Pakistan State Oil (PSO.KA: Quote, Profile, Research) on May 5.
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