This was a massive sale deal..I think it well overshot expectations:
Etisalat of UAE wins 26 percent stake in Pakistan telecom giant PTCL ISLAMABAD, June 18 (AFP) - Pakistan Saturday sold a 26 percent stake in its largest telecom company PTCL (Pakistan Telecommunication Company) for 2.59 billion dollars to Etisalat of the United Arab Emirates. Etisalat’s offer of 1.96 dollars a share outbid those of China Mobile and SingTel of Singapore which offered 1.06 dollar and 0.88 dollar per share respectively.The deal is worth over US dollars 2.598 billion. “We are very happy over the bid which is beyond our expectations,” Pakistani minister of information technology, Owais Leghari said.(Posted @ 20:41 PST) http://www.dawn.com/2005/06/18/welcome.htm
The pakistani govt is full of corrupt thugs. Also many of the state-run companies are run by corrpt thugs, who run the companies in an in-effective way because of cronyism. Many of state-owned companies like wapda and KESE are suffering huge losses and cost the govt $1 billion in subsidy every year.
partially Privatizing state-run companies, will make companies more effective, corrupt thugs will be kicked out. The service will become good. The new partial owners will pump more money into companies and hence bring more technology and inverstment.
And the best of all govt wont have to suffer financial losses because they won’t have to pay subsidy, and the govt will get 60% of profits because the govt still owns 60% of company. the govt will stay low, get profit for doing nothing, because new owners will run company on their own,
I have only one question. With the world going increasingly wireless to a point that in the near future the land lines phones will be like having black and white TVs .. why would anyone want to invest in that?
Does PTCL offer wireless service? How profitable they are and what does the future hold for them, other than major layoffs?
bhai, PTCL is not just about land lines, it was the case in 1980s. It also controls country's Internet bandwidth and only uplink, fibre optic networks across the country, microwave and sattelite communication as well. PakTel the largest cellular carrier is also run by PTCL. In short its the mai-baap of Pakistan's communication.
Correction: I think Paktel is now a seperate entity, but PTCL has its own CDMA wireless service. I don’t know about the market share though, but with privatisation it will compete with Paktel, Mobilink and Ufone.
I don’t think that matters much since PTCL doesn’t control the cell phone market except paktel which isn’t even the top cell phone company in pakistan. Mobilink and instaphone I think ranks higher.
By the way, are they gonna sell more chunks of PTCL in the future or was the 26% all the government was willing to let go?
that’s the best thing about privatization. They can’t afford to “slaughter” the middle class if they wanna make some money. Believe me, they would be driven into bankruptcy. Unless ofcourse ONE foreign company controlled everything. All pakistan needs to make sure is that there is a lot of companies vying for business. That would naturally take care of the price gouging.
2.59 billion? 