The Government of Pakistan has launched a second attempt to privatize House Building Finance Company Limited, renewing efforts to bring the state owned housing finance institution into private sector ownership after the previous transaction failed to reach completion. The Privatisation Commission has signed a Financial Advisory Services Agreement with a consortium led by KPMG, appointing the group to advise on the proposed transaction and assist with the various stages required to take the company toward privatization. The renewed process comes after the government’s earlier attempt could not be concluded when Pakistan Mortgage Refinance Company Limited, the only prequalified bidder in that process, submitted an offer below the reference price approved by the Federal Cabinet. The Privatisation Commission rejected that bid, bringing the previous process to an end. The latest initiative represents a fresh effort to attract potential investors and establish a transaction structure that can support the sale of House Building Finance Company Limited while addressing the requirements of the government and prospective investors.
Under the new Financial Advisory Services Agreement, the KPMG led consortium will undertake comprehensive due diligence of House Building Finance Company Limited, assess the company’s value and recommend an appropriate structure for the proposed transaction. The advisory group will also assist the Privatisation Commission with investor marketing and the execution of the privatization process. The consortium includes KPMG, Bridge Factor, Haidermota & Co., HRSG and Asiatic Public Relations, bringing financial, corporate finance, legal, human resource and public relations expertise into the process. The advisers will therefore be responsible for examining the company’s financial and operational position, determining an appropriate valuation and helping establish a transaction framework that can be presented to potential investors. The advisory assignment is an initial but significant stage in the renewed privatization process, as the findings from due diligence and valuation will help determine the eventual structure and terms under which House Building Finance Company Limited could be offered to private sector investors.
The latest privatization attempt follows the failure of the earlier process, in which Pakistan Mortgage Refinance Company Limited was the only entity to qualify as a bidder. Although the company submitted an offer, the bid was lower than the reference price approved by the Federal Cabinet, leading the Privatisation Commission to reject it and preventing the transaction from being concluded. The government has now restarted the process with a new financial adviser and a broader preparatory exercise focused on due diligence, valuation, transaction structuring and investor outreach. The renewed approach is intended to provide a more comprehensive assessment of House Building Finance Company Limited before potential investors are approached. The Privatisation Commission will coordinate with the appointed advisers and relevant stakeholders as the transaction progresses under the approved framework and applicable regulatory requirements. The second attempt therefore remains at the advisory and preparation stage, and no private sector buyer has been selected at this point.
House Building Finance Company Limited is a specialised housing finance institution that provides financing for people seeking to purchase, build or construct homes. The renewed privatization effort forms part of the government’s broader push to increase private sector participation in housing finance and improve the management and governance of state owned enterprises. The government expects the proposed privatization to contribute to stronger operational efficiency and improved performance while supporting the development of Pakistan’s housing finance market. The process is also linked to the objective of expanding access to mortgage financing, particularly for low and middle income households that require financing to purchase or construct residential property. By seeking private sector participation in the institution, the government aims to create conditions that could strengthen the company’s operations and allow greater focus on housing finance services. The Privatisation Commission’s renewed engagement of external advisers is intended to help assess the company’s position and establish a transaction structure that can attract suitable investors while meeting the government’s requirements.
The second attempt to privatize House Building Finance Company Limited will now move through due diligence, valuation, transaction structuring and investor marketing before any final sale can take place. The KPMG led consortium will play a central advisory role throughout these stages, while the Privatisation Commission will oversee the process and coordinate with relevant stakeholders. The outcome will depend on the transaction structure recommended by the advisers, the valuation established through the process and the level of interest generated among potential investors. The government’s previous effort demonstrates that the reference price and investor offers will be important considerations in determining whether the renewed transaction can be completed successfully. For now, the appointment of the financial adviser represents the beginning of a new privatization process rather than a completed sale. If the second attempt succeeds, the government expects the change in ownership to support greater private sector participation in housing finance, improve operational performance and potentially widen access to mortgage financing in Pakistan.
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