Finance ministry seeks clarification
Some 20 state-owned companies have come under fire from the finance ministry as the boards of those firms defied the instructions of Prime Minister Sheikh Hasina and refrained from offloading the shares of the firms in the capital market. The ministry last week sought clarification from the errant companies for their repeated failure despite reminders from the ministry, a senior official at the bank and financial institution division under the finance ministry said.
The firms in question have been asked to clarify their respective positions for failing to carry over the orders from the highest authority of the government latest by May 5.
A few of the defaulting SoEs even missed five to six times the deadlines set for their offloading purpose, the official added.
‘The companies are errant ones; they tend to argue for the delay citing flimsy reasons as the boards and managements of the companies are unwilling to divest their shares and go public,’ another top finance official told New Age.
‘We will go for actions against their ill motives.’
Prime Minister Sheikh Hasina in November 2010 approved a proposal of the finance ministry to offload considerable stakes of 27 SoEs. The finance ministry set the deadlines for the offloading of the companies and fixed shares of stakes to be divested in the capital market, sources said.
However, an assessment report prepared by the bank and financial institution division last week revealed that only seven state-firms complied the government’s instruction, while the rest 20, despite taking fresh deadlines from the ministry for the purpose shelved the divestment plan.
‘The directors and top management of the defaulting SoEs are reluctant as they do not want to lessen their grip on the companies they represent through selling out the stakes,’ a senior official told New Age.
He said the objectives of the government are making availability of shares of good companies in the capital market and strengthening accountability of the SoEs as their accounts will come under the scanners of securities regulators after being divested.
The report of the division said during the last three years only seven SoEs divested their shares between 5.0 per cent and 49 per cent. The companies are—Meghna petroleum company ltd, Jamuna oil company ltd, Eastern Lubricants Blenders Ltd, Bangladesh Shipping Corporation Ltd, Rupali Bank Ltd and National Tubes Ltd.
The report, expressing utter dissatisfaction over the progress of share offloading plan said most of the remaining 20 firms were given extension of their deadlines several times, but they refrained from implementing the divestment plan of the government.
The companies include Liquefied Petroleum Gas Ltd, Bakhrabad Gas Transmission and Distribution Ltd, Gas Transmission Company Ltd, Jalalabad Gas T&T System Ltd, Sylhet Gas Fields Company Ltd, Bangladesh Gas Fields Company Ltd, Pragati Industries Ltd, Essential Drugs Company Ltd, Bangladesh Services Ltd, Biman Bangladesh Ltd, BTCL, Teletalk Bangladesh Ltd and Bangladesh Cable Shilpa Ltd.
The finance officials said they were now keen to offload shares of at least five to six companies by this year as the capital market lacks good scripts.
-With New Age input
