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The Pakistani government on Tuesday night announced it had resolved all its differences with Etisalat of the United Arab Emirates over privatisation of Pakistan Telecommunications (PTCL), the country’s largest telecoms company.
The privatisation ministry said a team from Etisalat was due to visit the country next week, and the government expected the transaction to be completed next month.
Etisalat bought 26 per cent of PTCL’s stock along with management rights in July when it offered to pay $2.6bn for the company – almost twice as much as the second-highest offer, from China Mobile. Etisalat immediately paid $260m, equivalent to 10 per cent of its offer, but failed to meet the October deadline for paying the remaining $2.34bn.
Privatisation ministry officials subsequently said that Etisalat had tried to seek major concessions such as tax benefits for PTCL, listing the company’s shares on the Dubai stock exchange and a new schedule to stagger the remaining payments over the next few years.
However, senior privatisation and telecoms ministry officials revealed to the Financial Times this week that the Pakistani government had agreed to seek part of the remaining payments over a two to five-year period provided Etisalat agreed to pay at least $1.14bn up front.
“We can not accept anything less than the second-highest offer but are willing to consider a payment schedule for the rest of the amount,” a telecoms ministry official said yesterday after the announcement.
Senior Pakistani officials said Tuesday’s agreement followed intervention by senior Pakistani leaders. “The PTCL case was the largest Pakistani privatisation ever. We were keen not to let it collapse at any cost” said a telecoms ministry official.