The document analyzes the impacts of privatization on Pakistan Telecommunication Company Limited (PTCL), detailing the steps taken for its privatization since 1991 and the involvement of Etisalat, which acquired a 26% share. It discusses both the positive effects, such as the introduction of new technology and improved customer service, and the negative impacts, including decreased market share and layoffs due to poor service quality. Recommendations include enhancing service quality, introducing new products, and improving customer service.

1. Presented By: Umair Ahmed Roll No: 164 B.B.A (Hons.) 7 th Evening Presented To: Department of Management sciences University of Education Okara Campus Impacts of Privatization on PTCL

2. Outline Research Question Goals of Research What is Privatization? Etisalat Analysis And Findings Conclusion And Recommendations

3. Research Question What is impact of privatization on PTCL?

4. Goals of Research Impact on Performance Impact on Competition

5. What is Privatization? “ It is the process of selling government assets to private buyers” . Privatization is process of transferring ownership of a business, enterprise, agency or public service from the public sector (government) to the private sector (business). In a broader sense, privatization refers to transfer of any government function to the private sector including governmental functions like revenue collection and law enforcement.

6. Etisalat The UAE based company that purchase 26% of shares with management rights. It’s Vision: A world where people’s reach is not limited by matter or distance. It’s Mission: To extend people’s reach

7. Analysis And Findings Privatization Process of PTCL Impacts of privatization on PTCL Impact on Performance Impact on Competition Impact on Employment

8. Privatization Process of PTCL In 1991 Govt decide privatize PTCL, by selling 26% shares with management rights. In 1994 12% of its shares are divested. In 1994 Govt issued 1 million exchangeable vouchers, equal to 100 million shares of Rs.10each for Rs.3 billion . In September 1994 five million vouchers has been issued to 31 international investors for $ 900 million.

9. Privatization Process of PTCL In 1997 notes of $150 million are issued to international investors which are convertible to “A” class ordinary shares, which are equal to 3.3% of total share capital. In 1998 Govt hire M/s Goldman International to provide advisory services. According to M/S Goldman Report, PTCL handed over to Etisalat, That purchase 26% shares with management rights.

10. Impacts of Privatization on PTCL Impact on Performance Impact on Competition Impact on Employment

11. Impact on Performance Liquidity

12. Continued... Leverage

13. Continued... Profitability

14. Continued... EPS

15. Continued...

16. Continued...

17. Continued... Dividend paid in five years

18. Impact on Competition With privatization of PTCL may competitors entered into the market and PTCL’s market share is day to day decreases, due to the following reasons: People switch toward cellular phones WLL users switch toward wateen, world call and Tele Card because of better quality. Customer services are better then PTCL

19. Continued...

20. Continued... However it is in favor of PTCL that it still has almost monopoly in landline subscribers

21. Impact on Employment Before Privatization : PTCL has approx. 65000 employees before privatization. The main workforce of the PTCL is unqualified and unskilled. About 50% employees are under graduate.

22. Continued... After privatization the following decisions have taken by management: Launch VSS (voluntary separation scheme), under this scheme PTCL has to pay a lump sum amount to employee who is willing to leave. Step forward to facilitate equal employment opportunities.

23. Continued... Inducting fresh blood from the market T & D department organized a comprehensive six months “Urgent Training Needs” program in technical and managerial fields to enhance soft skills.

24. Conclusion Privatization of PTCL have both positive and negative impacts. Some negative impacts are: The number of subscribers are decreases year to year because of, poor quality of services, old technology and higher prices. PTCL is in the process of layoff and provides a huge some for this purpose while competitors have skilled Personnel and offers attractive packages.

25. Continued Besides these negative impacts PTCL also have some positive impacts: PTCL introduced new technology in some areas. Improve customer services

26. Recommendations I Recommend PTCL to: To Improve quality of services Introduce new products Introduce new technology Improve customer services