NPPMCL receives Rs100b bids from banks

Both conventional, Islamic banks show interest in project financing

ISLAMABAD:

National Power Parks Management Company Limited (NPPMCL) has received an unprecedented response from a syndicate of local banks for project financing in excess of Rs100 billion.

NPPMCL, which owns and operates two power plants, was being privatised by the Privatisation Commission (PC), which led the recapitalisation of government of Pakistan’s equity and sovereign guaranteed debt, refinancing it with a long-term project loan on a commercial basis, said a statement on Monday.

The bank syndicate included both conventional and Islamic banks. The transaction had been structured and executed by PC, in conjunction with the Ministry of Finance and NPPMCL, without any support of financial adviser or intermediary, saving a significant amount in advisory fee, the statement said.

Federal Minister for Privatisation Mohammed Mian Soomro expressed his gratitude to the banks for showing willingness to finance the project.

“We are heading towards the completion of this landmark transaction within the stipulated time frame,” he said.

On the occasion, PC Chairman Saleem Ahmad stated “these indications from local banks not only underscore the depth and liquidity of capital markets in Pakistan but also reinforce the quality of the obligor risk and significance of the power sector.”

He acknowledged the importance of an efficient capital structure in providing affordable electricity to the consumer as well as enabling sale of the entity to blue-chip investors and operators.

NPPMCL owns and operates 1,230-megawatt combined-cycle Haveli Bahadur Shah power plant in Jhang and 1,223MW combined-cycle Balloki power plant in Kasur and “is one of the biggest public-sector power producers in the country”, the statement said.

Published in The Express Tribune, March 22^nd, 2022.

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