Shanghai Electric bids for stake in Pakistan’s K-Electric

SHANGHAI, CHINA: China’s state-backed Shanghai Electric Power said it is bidding to acquire a stake in Pakistani utility K-Electric Limited, formerly known as Karachi Electric Supply Company Limited, which has a total market value of $2.3 billion.

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“Our company has embarked on preliminary work on the acquisition of a stake in K-Electric. We have not entered into any exclusive negotiations yet and the size of the stake has also not been firmed up,” Shanghai Electric said in a statement on the Shanghai stock exchange on Monday.

The statement, however, it was not the only company participating in the bidding process.

Dubai-based private equity firm Abraaj Group has flagged its intention to sell its stake of about 66 per cent in K-Electric, which supplies power to over 2.2 million customers in and around Karachi.

As of Monday, Abraaj’s stake was valued at around $1.5 billion. The Pakistan government owns about 24 per cent in K-Electric.

As per K-Electric, currently, it is the only vertically-integrated power utility in Pakistan that manages the generation, transmission and distribution of electricity to the city.

The Company manages a huge area of over 6,500 square kilometres and supplies electricity to all the industrial, commercial, agricultural and residential areas in the city that come under its network, comprising over 2.2 million customers in Karachi and adjacent towns of Dhabeji and Gharo in Sindh.

It also covers Hub, Uthal, Vindar and Bela in Balochistan, according to K-Electric.

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Shanghai Electric bids for stake in Pakistan’s K-Electric

by Reuters