Pakistan approves mergers of leading Saudi company with stakes in its steel sector

An undated file photo of Saudi Iron and Steel Company (Hadeed)'s manufacturing site in Jubail, Saudi Arabia. (Photo courtesy: SABIC/website)
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Updated 25 February 2024
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Pakistan approves mergers of leading Saudi company with stakes in its steel sector

  • M/s Saudi Iron and Steel Company (Hadeed) deals in spot sales in Pakistan’s steel market, exports to South Asian country
  • Three mergers are not anticipated to raise competition concerns in the relevant market, says competition commission

ISLAMABAD: The Competition Commission of Pakistan (CCP) this week approved three mergers concerning a leading Saudi company that has a significant presence in Pakistan’s steel market, the regulatory body said. 

Based in the kingdom, M/s/ Saudi Iron and Steel Company (Hadeed) produces a range of steel products and deals in spot sales in Pakistan’s steel market. Hadeed also exports to the South Asian country through international traders.

The CCP said in its press release on Saturday that the Public Investment Fund (PIF), Saudi Arabia’s sovereign wealth fund, sent a pre-merger application to CCP to acquire 100 percent shareholding of Hadeed from M/s. Saudi Basic Industries Corporation (“SABIC”).

“PIF has entered into a share purchase agreement with SABIC, under which SABIC agrees to sell its entire share capital of Hadeed to PIF,” the CCP said. 

The second merger involved Hadeed acquiring 100 percent shareholding of Al Rajhi Steel Industries Company from M/s. Mohammad Bin Abdulaziz Al Rajhi & Sons Investment. 

Al Rajhi Steel, established in 1978, is a subsidiary of Al Rajhi Invest and is known for its steel manufacturing capabilities in Saudi Arabia. This involved a share exchange agreement between Hadeed and Al Rajhi Invest.

In the third stage, the CCP said PIF intends to dispose off its 44.5 percent shareholding in Hadeed to M/s. Mohammad Bin Abdulaziz Al Rajhi & Sons Investment, the CCP. It added that the move was intended to share control over Hadeed and Al Rajhi Steel to improve their respective production capabilities and increase their operational efficiency.

“These transactions, as per the information available, are not anticipated to raise any competition concerns in the relevant market,” the CCP said. 

It said Pakistan’s steel sector is “one of the most important industries in the country” and with investments, can raise the country’s GDP to bring benefits to both the economy and investors.


Pakistan to hold major spectrum auction early next year, paving way for 5G rollout

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Pakistan to hold major spectrum auction early next year, paving way for 5G rollout

  • Pakistan’s IT Minister Shaza Fatima says auction aimed for late January or early February to ease congestion, improve Internet quality
  • ECC cleared auction framework after international benchmarking, as finance minister warns unsold spectrum causes economic losses

ISLAMABAD: Pakistan plans to complete a major telecom spectrum auction at the beginning of the next year, paving the way for the country’s first rollout of 5G services, Information Technology Minister Shaza Fatima said on Tuesday.

The planned auction comes amid mounting pressure on Pakistan’s telecom networks, with users and businesses complaining of slow Internet speeds and frequent disruptions as limited spectrum struggles to serve a population of about 240 million.

“Our effort is to complete this auction by the last week of January or the first week of February,” the minister told a joint news conference. “The quality of Internet service in Pakistan is not at par with international best practices or even regional standards, and one of the fundamental reasons for this is that spectrum is simply not available.”

She said Pakistan’s entire population currently operates on about 274 megahertz of spectrum, compared with around 600 megahertz in Bangladesh, leading to congestion that she likened to “trying to run eight lanes of traffic through two lanes.”

The minister said the government plans to auction nearly 600 megahertz of spectrum — the largest such auction in Pakistan’s history — including several frequency bands that have never been auctioned in the country before.

The move would improve 3G and 4G services and introduce 5G in Pakistan for the first time, she added.

Finance Minister Muhammad Aurangzeb said earlier at the news conference that the Economic Coordination Committee (ECC) had approved recommendations for the auction prepared by the Spectrum Advisory Committee after extensive consultations with telecom operators, regulators and consumers.

“Unsold spectrum directly translates into economic loss,” he said, adding that the committee had engaged a reputable international consultant, National Economic Research Associates, to advise on spectrum pricing, payment terms and auction design based on international benchmarks.

He said the government had reviewed those recommendations using what he described as a “Pakistan-first lens” before securing ECC approval, with the proposal now set to go to the cabinet for final clearance.