The bidding for the sale of 40 percent of PSX’s stocks started on 5th December and a Chinese-led Consortium has won with a bid of Rs 8.96 billion ($85.5 million or Rs 28 per share).
The said Consortium comprises of three Chinese Exchanges:
- China Financial Futures Exchange Company Limited (being the lead bidder),
- Shanghai Stock Exchange,
- Shenzhen Stock Exchange.
Two local Financial Institutions, Pak China Investment Company Limited and Habib Bank Limited were also part of the bidding process.
Pakistan has seen major Chinese investment in recent months, especially under the China-Pakistan Economic Corridor, a multibillion-dollar infrastructure program. The program aims to improve the land route between both countries and boost Pakistan’s energy generation capacity.
Pakistan’s Stock Exchange has been one of the best-performing markets in Asia this year, with the KSE 100-stock index gaining 42% this year. It was also included in MSCI’s Emerging Markets Index.
Due to the impressive performance of the stock market, Pakistan saw a lot of overwhelming foreign interest. A total of 19 parties were interested in investment including strategic investors from China, UK, US and local institutes such as MCB, National Bank, HBL and Faysal Bank.
Speaking about the 40 percent sale, Shehzad Chamdia, chairman of Pakistan Stock Exchange, said:
This is big news. Not only for us, but also for the country. I think it will be a game changer for our capital markets.
According to the devised PSX policy, 20 percent of the shares worth Rs $160 million will be offered to the general public. However, the sale of those 20 percent stake will only materialize after the acquisition process is completed with the strategic investors.