Kumul Consolidated Holdings (KCH)
KCH is the entity which holds in trust, the Government’s non-petroleum and non-mining assets. KCH (formerly known as IPBC) was established in July 2002 under the Independent Public Business Corporation of Papua New Guinea Act 2002 (the “IPBC Act”). KCH, is mandated to hold all Government-owned commercial assets in trust and to manage those assets to improve commercial performance and underpin economic development. KCH is not responsible for the Government’s mineral, oil and gas assets.
As a trustee, KCH is the holding company for nine (9) State Owned Enterprises (SOEs) operating in agriculture, aviation, banking and financial services, insurance, maritime infrastructure, power, post and logistics, telecommunications, and water and sanitation. KCH also acts as the manager of infrastructure projects throughout PNG such as hydroelectric power facilities, metropolitan sewerage systems, property and port developments.
KCH Direction and Purpose
KCH is the State’s private equity and investment company with a clearly-defined mandate to build shareholder wealth and to improve the provision of services to the people of Papua New Guinea by:
- improving existing and new SOE performance through organic and external development;
- investing in strategically important sectors – currently telco, power, agriculture, fishing, property and tourism;
- investing in profitable and turnaround growth opportunities in non-oil and gas and mining industries that provide strategic and financial benefit to the State;
- leading corporate and sectoral restructuring initiatives; and
- optimising funding opportunities for KCH and its investee.
KCH Legislative Framework
KCH is a 100% State-owned statutory corporation and an independent body that perform its functions and duties and exercise its powers and authorities:
- in accordance with sound business principles and with due care, diligence and skill that a prudent business would adopt or exercise in similar circumstances; and
- reports to the National Executive Council (NEC) through the Minister for Public Enterprises and State Investments.
KCH Legislative Objectives
KCH acts in the role of a trustee for the long-term asset and liability management of the Government. Its corporate objective is threefold:
- to act as trustee and hold assets and liabilities that have been vested in or acquired by it, on behalf of the Government;
- to act as a financial institution for the benefit of and the provision of financial resources and services to Government-owned enterprises and the Government, where this is approved by the National Executive Council (NEC); and
- to enhance the financial position of the Government or Government-owned enterprises.
KCH’s accounts and records of financial transactions are audited by the Auditor General. KCH does not consolidate its accounts as it adopts a fair value approach of its assets and investments.
The Government has the following interests under KCH: