Pakistan, UAE’s Etisalat rectify 14-year-old valuation quarrel

The Pakistani government has decisively reached a settlement with UAE’s Etisalat over what seemed to be a never-ending quarrel following the Emirati operator’s acquisition of a faction of shares in Pakistan Telecommunication Company Limited (PTCL).

The achieved settlement focuses on the assessment of multiple properties initially planned to become a segment of PTCL after its 2006 privatization. In the agreement’s terms, Hatem Dowidar, Etisalat’s CEO, confirmed that the Emirati telco will pay $2.6 billion for a 26 percent share value in PTCL. A $1.8 billion sum has already been approved and paid upfront.

Etisalat had previously arranged a five-year extended period to finalize the remainder of the payment to the Pakistani government on the grounds that more than 3000 properties will be rolled into PTCL.

However, by the time UAE’s telecom operator realized that the government could not maintain its part of the deal by establishing its role in the agreement, Etisalat refrained from finalizing the remainder of its balance, therefore putting it on hold any future actions.

Originally, before the accumulated tensions on the deal, the sale deed’s quarrel circulated the settlement of several properties via valuation of assets by the government and Etisalat. 

PTCL’s asset management department submitted in its privatization agreement false and exponentially faulty records of its properties. The document stated that the Pakistani telco owned 3,248 properties when in reality, it had 3,384. The privatization agreement finalized in 2006 has been in full dispute mode for the past 14 years.

In 2015, due to legal terms, segments of the firms’ transfer deal to PTCL had been finalized, with only 30 remained lingering until final agreement on any lingering legal conditions. Some of these firms were properties obtained by private investors and should not be in the original agreement between the Pakistani government and Etisalat.

According to the CommsUpdate, Pakistan’s government succumbed to an agreement stating that it must extract the value of the mentioned private properties from the $800 million sum that is currently owned by Etisalat.

It is worth mentioning that Pakistan’s government has previously proposed to Etisalat a $60 million deduction from the total of $800 million.

Nevertheless, none of the mentioned agreements have been finalized as parties close to the matter will decide on a just and impartial fair valuation of the properties.

Until now, Pakistan’s Ministry of Finance disclosed that both parties are trying to reach a mutual understanding, supervised by “internationally renowned evaluation companies.” UAE’s Etisalat’s CEO has already given his blessing to this process as it could potentially lead to the valuation’s completion in a matter of “a couple of months.”