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Pre-bid meeting for NIT sell-off on 24th

* Only Rs 39 billion assets to be sold off

By Arshad Hussain

KARACHI: The Privatisation Commission has set a pre-bid meeting with 15 pre-qualified parties for the sell-off of the National Investment Trust (NIT), Pakistan’s largest mutual fund worth Rs 80 billion, a source in the NIT told the Daily Times here on Wednesday.

The government has decided to separate the units (possession of units) of National Bank of Pakistan (NBP), Faysal Bank, Bank of Punjab and Bank of Khyber, which already possess around Rs 40 billion of its assets through the government’s letters of comfort (LoC).

“The share of the four major participants and LoC holders have been separated from April 1, 2007,” said Tariq Iqbal Khan, chairman of the trust. “The participants cannot offer bids for such assets, but the four LoC holders can offer bids for the remaining shares,” he added.

The due diligence of the companies had already been completed in March 2006. By April 24, the fund would have assets worth Rs 80 billion approximately, he said.

The inside sources said the bidders are Arif Habib Securities, JS ABAMCO Limited, AKD Fund Management, KASB Securities, Atlas Bank, MCB Bank, United Bank Limited (UBL), Habib Bank Limited (HBL), Bank Al Habib, PICIC Commercial Bank and four LoC holders.

The participants would discuss the bid procedures and raise other questions regarding the privatisation of NIT with the Privatisation Commission Board on April 24.

“All the participants would offer bids for the remaining units or assets of the trust, which are approximately worth Rs 39 billion,” the official said. The net assets under management have increased from Rs 64.30 billion as on June 30, 2006 to Rs 78.25 billion as of March 31, reflecting a strong growth of 21.70 percent.

According to sources, the Faysal Bank has possessed units worth Rs 8.5 billion, the National Bank of Pakistan Rs 24 billion, the Bank of Punjab has Rs eight billion and the Bank of Khyber has approximately Rs 1 billion units.

By the end of March this year, the NIT gained 1.82 percent in KSE 100-index, while its net asset value has increased by 14.65 percent from Rs 43.07 as on June 30, 2006 to Rs 49.38 as on March 31, 2007 against an increase of 12.84% in KSE-100 index during the period under review period.

The net income earned by the fund during the nine months ended on March 31, 2007, stood at Rs 4.57 billion, which translates into earning per unit of Rs 2.88. The net income of Rs 8.22 billion earned by the Fund during the corresponding period of last year included a capital gain of Rs 5.128 billion earned from sale of strategic holding of National Refinery Limited through Privatisation Commission. Thus, the net income of the Fund excluding capital gain of National Refinery Ltd during the corresponding period of last year increased by 47.6%.

The dividend income of the trust stood at Rs 2.41 billion during the nine months, which is around the level of dividend income earned by the fund in the corresponding period of last year.

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