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Who owns Pakistan?

Corporate Quiz
Who owns Dentonic Limited. First company to be incorporated in Pakistan in 1947?
They are Pakistan's super-rich, popularly known as the 22 families and their names, the Saigols, Dawoods, Habibs, Adamjees, Bawany, Hashwani, Sharifs of Ittefaq and Sheikhs of the Colony group are synonymous with enormous wealth and unbounded pelf.

There are two sets of the 22 families, the original 22 and the 22 families of the present era including unknown or little known Sargodha and United groups, the Chakwal group, Gulistan-Saphire, Rupali and Fazalsons.

On Dec 1, 1995, the top 43 groups owned 212 of the 522 non-financial companies listed at Karachi Stock Exchange (KSE) accounting for 43% of the total manufacturing assets, exclusive of the multinationals and the public sector enterprises. Out of 175 listed banking companies, modarabas, leasing and financial companies, 76 belonged these groups.

Their power was clustered in textile, sugar, cement, insurance, banks and modarabas while almost all the newly listed captive power plants belonged to these groups. Together they owned at least 122 textile mills, 19 sugar mills, eight cement plants, 12 insurance companies, 11 banks, 16 modorabas, eight leasing companies and seven power plants.

Like sheep these families have followed each other, one poineering an industry and the other smelling profits coming on its heels. Last such fad was modaraba and the latest example of sheep-flocking has taken place in the power generation in which Mian Mansha was first to move and now almost every big group has its own captive power plant or has one on the anvil.

These groups own assets worth Rs 408 billion on KSE but what they own on the stock exchange is only a tip of the iceberg because in addition to the listed companies they own at least 370 unlisted public and private limited companies whose assets and turnover is not known accurately even to the Corporate Law Authority. A fair estimate of these assets would be Rs 500-600 billion for the following reasons.

    A committee headed by former finance secretary H U Beg had found in 1993 that 38 groups in Pakistan were controlling assets worth Rs 380 billion. Like so many other reports of committees and commissions appointed from time to time in the past, the report of this committee has also been assigned to the shelves on the Corporate Law Authority to gather dust and no reference is ever made to its findings. The estimates of H U Beg committee would seem grossly under-estimated in 1997 because of the massive growth in the private sector banking since 1993.

    In post-nationalization era of the 1970, the leading industrial families resorted to Double D strategy of dispersing and diversifying, taking pains to camouflage their identity. A very glaring example is the House of Habib which was reported to have 90 companies in its fold in 1984 but I could identify only half of them.

    The list of companies owned by the Ittefaq group, as found by the Beg committee included 19 companies with estimated assets of Rs 10 billion. I have identified at least 29 companies is this group. The efforts by big groups to cover their tracks are made easy by the absence of any law requiring them to disclose their assets, although for several years CLA has been toying with feasibility of requiring the groups to publish consolidated annual accounts.

    In additions to the assets held in their own groups, several of these leading industrialists also own equity in the blue chip multinationals over KSE. For example, Babar Ali is Chairman, Hoechest Pakistan Ltd, Siemens and Lever Brothers and Kasim Dada is Chairman of Burger Paints. Smithkline and Brook Bond Ltd holding upto 25% equity in these companies. However, the equity in the multinationals is not taken into considration while ranking them for this study.

    At least five groups namely Saigols, Nishat, the Hashoo group, Fateh and Habib have revealed in interviews and annual reports to have companies incorporated abroad. Thus Nasim Saigol has Kohinoor England, Nishat has Nishat Europe and Newbury Mansha (Pvt) Ltd, Sadaruddin Hashwani has Tempa Pak Ltd, Florida, Habib have AG Zurich and Habibsons while Fateh group have subsidiaries in Hong Kong and Germany. Evidently , other groups too, must have incorporated companies abroad but no refrence is ever made to them in their profiles and reports.

Lawrence J. White, in his book " The Industrial Concentration and Economic power in Pakistan" had estimated that on the eve of nationalization 43 groups or families owned 98 of the 197 non-financial companies listed on KSE, accounting for 53% of the total assets represented on the stock exchange.

The tables on the next page give a comparative picture of the 22 families in 1970, as found by Lawrence White, their position in 1990 as established by monthly Herald of June 1990 and their ranking in 1997 in WHO OWNS PAKISTAN?

22 families in 1970, 1990 and 1997

Table of Contents

Benazir Bhutto and Hashwnais

Robber Barrons of Pakistan