PTCL delay impacts KSE 100
by Brian Turner
A delay on Monday in the sale of up to 26 percent of shares in Pakistan Telecommunications (PTCL), the state-owned monopoly, caused the KSE-100 average in Karachi to fall more than 4 percent to just above the 6900 level in the first hour of trade on Monday.
The delay in the sale, meant to privatize the company, was announced late on Friday night before a Monday strike deadline by the PTCL labour unions. The unions had threatened to strike if the privatization were to proceed.
The sale of the 26 percent share of PTCL was to be accompanied by a transfer of management to the new buyer. In turn, new management was expected to cut the jobs of many of PTCL’s 61,000 employees.
A government minister said that a new date for the sale might be announced later this week and that the delay was temporary and just a move to avert the planned strike, but an analyst said that confidence in the sale had been destroyed by the cancellation an that even if a new date for the sale is announced soon, few people would believe in its reality.
The sale of the 26 percent share in PTCL was expected to bring in between US$1.5 - 1.6 billion.
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