Panel formed to offload shares of state power companies

The government yesterday formed a four-member panel to find ways to offload the shares of state-owned power companies, to raise capital from the stockmarket.

In addition to an assessment, the committee will indentify an effective way to find alternative sources for those companies of financing through bond issues or other instruments.

The panel, led by Power Division Secretary Monowar Islam, will submit a report to the government in 30 workdays. Other members of the committee comprise representatives of Bangladesh Securities and Exchange Commission, Dhaka Stock Exchange and Investment Corporation of Bangladesh.

The decision came at a meeting organised by the Power Division under the power, energy and mineral resources ministry that sat with key stakeholders to initiate the move.

The purpose of the meeting was to discuss how funds can be raised from the capital market and invest the money in different projects of the companies under the power division.

“The performance of the existing listed power companies, including state-owned ones, is comparatively better than other sector firms. So, the government has come forward to raise capital from the market and invest the funds in its different power projects,” said a participant who attended the meeting, seeking anonymity.

Presently, two state-owned power companies are listed on the stockmarket -- Dhaka Electric Supply Company (Desco) and Power Grid Company of Bangladesh (PGCB).

In 2006, the government offloaded 25 percent of its shares in Desco and 23.75 percent of its shares in PGCB through direct listing.

Some other non-listed companies under the power division include Dhaka Power Distribution Company, West Zone Power Distribution Company, Electricity Generation Company of Bangladesh, North-West Power Generation Company, and Rural Power Company.

On the Dhaka bourse yesterday, each Desco share traded between Tk 72.2 and Tk 68.4, before closing at Tk 69.3; a PGCB share traded between Tk 37.6 and Tk 34.7 before finishing at Tk 37.6.

Titas Gas Transmission and Distribution Company was the last state-owned company that was listed on the stockmarket in 2008.

After that, the government in January 2010 selected 26 state companies and instructed them to offload shares in the next six months. But since then, no companies offloaded shares, despite repeated deadlines and instructions from the finance ministry.