Etisalat's Pakistan purchase reportedly cancelled

Despite last minute meetings, Etisalat's purchase of a controlling stake in PCTL looks off with the UAE operator failing to pay up on time.

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By  Alex Ritman Published  October 30, 2005

Etisalat’s purchase of a controlling stake in Pakistan Telecommunication Company Limited (PCTL) is reportedly off, with the UAE operator having failed to make the agreed payment by the deadline. “In spite of the necessary facilitation within the transaction framework, Etisalat failed to make payment of the balance bid amount within the mutually agreed extended timeline of October 28, 2005,” was the view expressed in a statement from the Privatisation Commission on October 29 following an emergency meeting involving Pakistani prime minister Shaukat Aziz. According to the statement the matter has now been referred to the privatisation board and to the Cabinet Committee on Privatisation. Etisalat was announced as the winner of a 26% stake in PTCL on June 18, with the original terms specifying that after a 25% initial payment, the remaining 75% would be paid within 60 days. Following meeting betweens senior officials, this deadline was then extended to October 28. Hafeez Sheikh, Pakistan’s privatisation and investment minister, told reporters after the emergency meeting on October 29 that the government still wanted the deal with Etisalat to be ratified. A later meeting between Sheikh and prime minister Aziz was reportedly held in order to discuss whether the largest privatisation deal in Pakistan’s history should be offered to the second highest bidder, China Mobile. The privatisation commission may retain the US$650 million down payment already handed over by Etisalat. The UAE operator says it will issue a statement within two days.

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