ISLAMABAD, 30 December 2003 — Pakistan received a top bid of $389 million for a 51 percent stake in Habib Bank Ltd., the country’s second-largest bank, from Agha Khan Fund for Economic Development yesterday, officials said.
The bid was higher than the $382 million offer from the State of Qatar Supreme Council for Economic Affairs and Investment for the controlling stake in the bank.
Privatization Minister Hafeez Sheikh said he would take the Agha Khan Fund bid to the government for approval. “It is an important day for the privatization program of Pakistan,” he said, adding that he hoped more foreign investment would come into Pakistan through the sale of government entities.
Ahmed Waqar, secretary to the privatization commission, said the government would take 30 days to decide on the highest bid.
“It will be the biggest single entity transaction in the history of privatization in Pakistan,” Waqar said.
Pakistan last year sold 51 percent stake in the United Bank Ltd. for $208 million to the Abu Dhabi Group and Bestway Holdings.
Mohammad Sohail, head of research at Investcap Securities, said the offer for Habib Bank was a success for the government, and that it should help its efforts to seek investment. “They got a good price and a good group,” he said. “When you compare it with the United Bank it is a decent price. It is a success for the government.”
Agha Khan Fund already operates a micro-finance bank and a chain of luxury hotels in Pakistan, as well as welfare projects in health, education and rural infrastructure.
Habib Bank has about 20 percent of the country’s banking market with 1,425 branches in Pakistan, as well as 48 others in 26 countries.