ISLAMABAD (November 14 2006): The Privatisation Commission on Monday announced that it would offer Oil and Gas Development Company (OGDC) global depository shares (GDS) through London Stock Exchange from November 15. For GDS reporting, the books will remain open at London Stock Exchange as well as local stock exchanges for 15 days.

GDS closing will be followed by secondary public offering at discounted rates in the local market. Privatisation Minister Zahid Hamid unveiled GDS and IPO plan here at a press conference. He was accompanied by OGDC Chairman/Managing director Arshad Nasar and Executive Director Najam Kemal Hyder.

Zahid said that OGDC GDS and the secondary public offer would be up to 15 percent of capital share (645,139,000 shares). GDS offer will be up to 532,939,000 shares for institutional investors, including qualified institutional buyers in the United States under Rule 144A, and IPO offering up to 32,300,000 ordinary shares in Pakistan.

He said that an option of over-allotment for GDS, up to 79,900,000 additional shares, was also available. He said that all proceeds from GDS would be received by the Government of Pakistan.

According to the minister, GDS would be listed at London Stock Exchange with each GDS representing 10 underlying ordinary shares. The ordinary shares will be listed at Karachi Stock Exchange, Lahore Stock Exchange and Islamabad Stock Exchange. The price for the shares and GDS offered in the institutional offering will be fixed following a book keeping process on or around November 30, with the price and allocations for shares and GDS announced on or around December 1. The first day of unconditional trading for GDS at London Stock Exchange is scheduled for December 6.

The Minister said that GDS offer represents Pakistan's domestic institutional investors for the first time in an international book keeping. BMA Capital, Citigroup and Goldman Sachs are joint lead managers with Citigroup and Goldman Sachs acting as joint global co-ordinator and bookrunners for the international offering and BMA capital as lead manager and bookrunner for the domestic offering and joint lead manager of the international offering.

Zahid termed GDS offering as market-driven, saying that market forces would asset the value of GDS and its size. He said that OGDC is a Pakistan asset and its GDS would get good response from investors. He referred to the country roadshows held some time back which he claimed were a great success, and now OGDC management was leaving for different destinations to arrange company roadshows to give the international investors an idea of the organisational strength.

He said that OGDC GDS is the largest ever equity offering of any Pakistani company abroad that would be a great steps forward of the ongoing privatisation programme. He said the offering would help raise more awareness among international investment community of the exciting investment opportunities in Pakistan. He observed that the offering would also broaden OGDC investor base, enhance its international profile and expedite its transition into a truly world-class, publicly-listed commercial enterprise.

Zahid told a questioner that the process for Pakistan Steel Mills' strategic sell-off and initial public offering (IPO) was under progress. He claimed that privatisation programme was highly transparent and its credibility was not questioned by the Supreme Court in PSM case.

OGDC Chairman/Managing Director said that the announcement for GDS offering was highly significant in OGDC's history. He said GDS offer would allow the company build a diversified, high quality investor base; as it always strives to achieve operational excellence and world class standards of corporate practices.

He said that as a leading exploration and production company in Pakistan, OGDC's objective is to enhance production and reserve profile that would ultimately maximise value for its shareholders. He said: "OGDC management looks forward to welcoming our new shareholders as we embark on our next phase of growth."

He said that OGDC is the largest petroleum exploration and production company in Pakistan with primary focus on gas. He added that it holds the largest portfolio of the recoverable hydrocarbon reserves in Pakistan, 32 percent gas and 37 percent oil respectively as on June 30 this year and it contributed 22 percent of the country's total gas production and 48 percent of oil production.

Arshad said that with a portfolio of 46 exploration licences, OGDC has the largest exploration acreage in Pakistan, covering 39 percent of total awarded area and now it was focusing on onshore exploration. OGDC had a net profit of Rs 45.8 billion for the year ended on June 30, 2006 and Rs 12 billion for the first three months of the current fiscal year, he added.