Nama Holding, the holding company of state-owned power sector entities, has exhorted local Omani businesses to participate in the landmark privatisation of its transmission and distribution subsidiaries.

The appeal was made at a workshop hosted by Nama Holding jointly with the Oman Chamber of Commerce and Industry (OCCI), at the Kempinski Hotel Muscat yesterday. High-level executives representing a number of private Omani business houses attended the event.

In opening remarks, Omar al Wahaibi, CEO Nama Holding, said the privatization journey, which began in 2005, has resulted in all of Omans electricity generation capacity ending up in private hands.

The next logical step is to bring in the private sector into the transmission and distribution side of the business. Having thus far engaged with potential international investors and operators in the privatisation of the first two of our subsidiaries Oman Electricity Distribution Company (OETC) and Muscat Electricity Distribution Company (MEDC) we are now looking forward to seeing local private firms participating in this exercise as well, he explained.

OETC, which owns and operates the Sultanates interconnected systems in the north and south of the country, as well as MEDC, which oversees distribution and supply across the capital region of Oman, are the first two of five Nama Group subsidiaries targeted for immediate privatisation. In the next stage, slated to commence in the second half of this year, Nama Group will offer up its three remaining distribution and supply entities for privatisation.These entities are Majan Electricity, Mazoon Electricity and Dhofar Power. Privatisation plans drawn up by Nama Holding based on mandates provided by the government envisage the sale of a 49 per cent stake in OETC to a strategic investor. Nama Group, with a majority 51 per cent stake, will continue to retain management control over the utility post-privatisation.

Nama Holding is offering a 70 per cent stake in MEDC to a strategic investor. The remaining 30 per cent is proposed to be offered to the general public via an Initial Public Offering (IPO), the timing of which will be decided in consultation with the strategic investors, and will also take into account the financial condition of the company at the time, and prevailing market conditions. In any event, the public offering is tentatively timed around 3-4 years after the successful conclusion of the privatisation of MEDC.

According to Shaikh Mansour bin Talib al Hinai, Vice-President Distribution & Supply, Nama Holding, a total of 25 applications (11 targeted at OETC and 14 for MEDC) have been received from 23 strategic and financial investors following a series of roadshows held in global capital in recent months. The goal now is to encourage local Omani businesses to take positions with these interested investors and thereby ensure an Omani presence, even if modest, in the consortiums participating in the privatisation exercise.

Todays workshop was designed to explore the possibility of bringing in local investors into the 11 consortiums that competing for stakes in the two companies, said Shaikh Mansoor al Hinai. This will help enhance the constitution of the consortiums through the inclusion of more investors with a local business understanding. Some of the consortiums already have local investors with them, but we believe that Omani investors can join all the others or enhance the existing consortiums with their knowledge about how to do business in Oman and the ease of doing business here in the Sultanate.

Nama Holding aims to finalise transactions with regard to the privatisation of OETC and MEDC before the end of this year.

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