The federal government, after appointing boards of directors of electricity distribution companies, has decided to transfer their assets to the managements in order to give autonomy to state-run units.
A summary for sale of 10 per cent shares of the Islamabad Electric Supply Company (IESCO) through stock markets will also be presented in the next meeting of the board of directors of the exchange, in order to move towards self-reliance and avert being a burden on public funds.
According to sources, the summary will be sent to the cabinet for approval through the Ministry of Water and Power, while it will also need approval of the Cabinet Committee on Privatisation and the Privatisation Commission.
Sources informed that these companies will prepare their final balance sheets once the assets have been transferred and IESCO shares have been sold on the stock market. Depending on the success of sale of IESCO shares, other distribution companies will follow suit and float their shares for initial public offerings on the stock market.
After the asset transfer, these companies will be able to acquire loans under revolving credit guarantee by pledging their assets.
Additionally, they will be able to issue Sukuk (Islamic bonds) through the Civil Aviation Authority, allowing self-generation of finances.
Published in The Express Tribune, March 16th, 2011.
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