Steel Mills ready to receive bailout fund
Company set to increase production in line with bailout conditions.
The Rs11 billion bailout package will be given in a single tranche in the shape of a soft loan provided by the National Bank of Pakistan. PHOTO: FILE
KARACHI:
A bailout package worth Rs11 billion will soon be given to Pakistan Steel Mills (PSM) for procurement of raw materials so as to enhance production to 80% by the end of this year.
The government-owned enterprise has managed to secure a lifeline bailout earlier this month under the caretaker government to continue operations. According to PSM spokesperson Shazim Akhtar, PSM has to enhance production up to 60% by the end of August 2013 in the first phase of the bailout package requirements.
The Rs11 billion bailout package will be given in a single tranche in the shape of a soft loan provided by the National Bank of Pakistan under a federal government guarantee. Furthermore, a banking consortium has been formed to work out the working capital requirements of PSM and arrange funding accordingly.
“In the light of the afore-mentioned government bailout package decided by the federal government, the PSM management has reorganised maintenance, operational and production strategies to obtain maximum benefit from the bailout deal within the minimum possible period,” the spokesman said. He said it was imperative to mention that the placement of order and shipment of raw materials had also been planned to maintain, at the very least, a 90-day stock of raw material, especially iron, ore and coal. He said that PSM is making all efforts to enhance its production levels until the bailout package is received as decided by the federal government.
After several previous bailout packages, the interim government decided to approve the most recent package in light of the strategic importance of the enterprise to the country.
Published in The Express Tribune, May 19th, 2013.
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A bailout package worth Rs11 billion will soon be given to Pakistan Steel Mills (PSM) for procurement of raw materials so as to enhance production to 80% by the end of this year.
The government-owned enterprise has managed to secure a lifeline bailout earlier this month under the caretaker government to continue operations. According to PSM spokesperson Shazim Akhtar, PSM has to enhance production up to 60% by the end of August 2013 in the first phase of the bailout package requirements.
The Rs11 billion bailout package will be given in a single tranche in the shape of a soft loan provided by the National Bank of Pakistan under a federal government guarantee. Furthermore, a banking consortium has been formed to work out the working capital requirements of PSM and arrange funding accordingly.
“In the light of the afore-mentioned government bailout package decided by the federal government, the PSM management has reorganised maintenance, operational and production strategies to obtain maximum benefit from the bailout deal within the minimum possible period,” the spokesman said. He said it was imperative to mention that the placement of order and shipment of raw materials had also been planned to maintain, at the very least, a 90-day stock of raw material, especially iron, ore and coal. He said that PSM is making all efforts to enhance its production levels until the bailout package is received as decided by the federal government.
After several previous bailout packages, the interim government decided to approve the most recent package in light of the strategic importance of the enterprise to the country.
Published in The Express Tribune, May 19th, 2013.
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