Privatization has also been used to describe two unrelated transactions. The first is the buying of all outstanding shares of a publicly traded company by a single entity, taking the company private. This is often described as private equity. The second is a demutualization of a mutual organization or cooperative to form a joint stock company.[2]
Primary Objectives:
The following are the primary objectives which have been defined in the Government’s policy statement on Parastatal Sector Reform:
Improve the operational efficiency of enterprises that are currently in the Parastatal sector, and their contribution to the national economy;
Reduce the burden of Parastatal enterprises on the Government budget;
Expand the role of the private sector in the economy, permitting the Government to concentrate public resources on its role as provider of basic public services, including health, education and social infrastructure; and
Encourage wider participation by the people in the ownership and management of business.
Secondary Objectives:
In so far as their pursuit is consistent with the primary objectives, the CHC intends to ensure that divestiture meets the following secondary objectives: to create a more market-oriented economy; to secure enhanced assess to foreign markets, to capital and to technology; to promote the development of the capital market; and to preserve the goal of self-reliance.
There are four main methods[citation needed] of privatization:
1.