KESC control given to Hassan Associates

ISLAMABAD - The government Tuesday handed over the management control of Karachi Electric Supply Corporation (KESC) to the Consortium of Hassan Associates after receiving the remaining payment of bid.

The share transfer documents for the privatization of KESC were signed and handed over by M. Tahsin Khan Iqbal, Secretary Privatization Commission to the authorized representatives of the consortium included Shan A. Ashary of Al-Jomaih Holding Company, Farooq Hasan of Hasan Associates, Haleem Siddique of Premier Mercantile Services here. Federal Minister for Privatization and Investment Dr Abdul Hafeez Shaikh and Ashfaq Ahmed Secretary Ministry of Water and Power were also present on the occasion.

Talking to reporters on the occasion Shan A. Ashary of Al-Jomaih assured KESC employees that no employee of the corporation would be retrenched. He said the company needs the services of employees to make it customer- friendly.

Frank Scherschmidt, the new Chief Executive Officer of KESC said that the company was already under staffed. Our goal was to make Karachi again a city of lights and for this we would train and motivate the staff to make company much more customer-oriented by improving the power generation and reducing the losses.

The privatization of KESC will bring better services through professional management, new investment, and technology and employment benefits. The measures taken for the interests of the workers include offering of 20 per cent increase in salaries to the contract employees and 10 per cent shareholding of KESC to the employees, the new management announced.

Dr Abdul Hafeez Shaikh Federal Minister for Privatization and Investment, while talking to the mediamen said that the transfer of management control of Karachi Electric Supply Company to the consortium of Hassan Associates (Pvt) Limited would provide best service to the industry and reduce the cost of doing businesses.

Dr Abdul Hafeez Shaikh said that after receiving the remaining amount for KESC, the PC has so far received 258 million dollars (in terms of Pak Rupees translates as Rs 15. 9 billion of the total bid offer of Rs 20.2 billion), which would also increase the FDI. The buyer will invest 500 million dollars in KESC over a period of three years while during the first phase the buyer will invest 75 million dollars.

The minister further said that the completion of KESC transaction would send strong signal to the investors and would speed up and also give impetus to the overall Privatization programme of Pakistan. Being a landmark transaction in the power sector, it would not only set the scene for a rapid turn around of KESC but also for the privatization of other electric utilities and for significant investment in the infrastructure of Karachi. It would convey to the world the government’s commitment towards the privatization process.

He added that all pervious governments had tried their best to improve the efficiency of the company in the larger interest of the consumers and this government was also motivated to bring the transaction to a concluding point with the support of President General Pervez Musharraf, Prime Minister Shaukat Aziz, members of CCOP & Privatization Commission Board, PC Staff & Secretariat and Ministries of Water & Power, Finance.

Dr Shaikh said the experienced team and the newly constituted board of KESC, which included reputable persons from the private sector would protect the consumers’ rights.

After KESC, the process of completing PTCL transaction, pre-bid conference for the privatization of PSO and to further process the privatization of PPL, NIT and PSMC on fast track basis would be conducted. Privatization of Pakistan Steel would be completed by mid-January 2005, he told.

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