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Home / Business / Divestment of 10% shares in ABL: Govt fixes floor price at Rs105 to generate Rs13b
Divestment of 10% shares in ABL: Govt fixes floor price at Rs105 to generate Rs13b

Divestment of 10% shares in ABL: Govt fixes floor price at Rs105 to generate Rs13b

ISLAMABAD: The government has fixed floor price at Rs105 per share for divestment of its 10 per cent (around 131 million) shares in Allied Bank Limited (ABL).

The Cabinet Committee on Privatization (CCoP), under the chair of Finance Minister Ishaq Dar, considered the ABL pricing benchmarks as presented by the LM & BR and recommended a floor price of Rs105 per share to the CCoP which translates into a discount of Rs9.69 per share to the closing price of Rs113.69 on December 9, 2014, i.e. at a discount of approximately 7.6 per cent to the closing price of the day.

Federal ministers Pervaiz Rashid, Khurram Dastgir, Shahid Khaqan Abbasi, and Privatisation Commission’s Chairman Muhammad Zubair, Secretary Finance Dr Waqar Masoodand, Adviser (finance division) Rana Asad Amin were also present in the CCoP meeting.

Book-building is starting from Dec 10 till the next day from 9am to 5pm. The Privatisation Commission’s board has already approved appointment of the consortium of Elixir Securities, MCB Bank and AKD Securities as lead manager and book runner for the divestment of government residual shares in ABL.

Through selling of around 10 percent remaining shares in ABL, the government wants to accumulate around Rs13 billion through the secondary public offering.

The strike price, at which ABL’s share will be offered to successful bidders, will be determined after 5pm on Thursday, and will then be submitted to the commission’s board for consideration and approval. The recommendations of the board will subsequently be presented to CCoP for approval.

The strike price will be calculated through the Dutch Auction Method, which will determine the maximum price at which all the offered shares are subscribed.