K-Electric (KE), Pakistan’s leading private-sector power utility, has called on Shanghai Electric Power (SEP) to raise its acquisition offer for a majority stake in the company to $2 billion.
This demand comes on the heels of SEP’s previous offer to acquire 66.40% of KE’s stakes for $1.77 billion, a deal that was marred by regulatory hurdles and legal disputes for an extended period.
Shan A. Ashary, Chief Investment Officer of Al-Jomaih and former director at KE, informed journalists that substantial improvements in KE’s infrastructure and customer base over recent years justify a higher valuation for the company. He stated, “We have made visible improvements in the power company through significant investments in the last few years, and as a result, we believe the offer should be raised to $2 billion.”
Ashary disclosed that he had met with Special Investment Facilitation Council (SIFC) officials to discuss Aljomaih’s issues but expressed disappointment at the lack of concrete progress on these matters. He, however, expressed optimism regarding the SIFC, a government initiative aimed at addressing foreign investor concerns.
Aljomaih Holding Company, a prominent Saudi conglomerate, and Kuwait’s National Industries Group (NIG) currently hold the largest share of KE, accounting for 47% of KES Power shares, which equates to 30% ownership in KE. Despite Asia Pak Investments’ claims of a 54% stake in KE, Ashary disputed this assertion, suggesting that their actual holdings were no more than 5%. Nevertheless, he extended an offer to Asia Pak Investments for a board position within KE.
Ashary also emphasized that KE’s board was fully operational and had submitted a comprehensive investment plan for Karachi to the National Electric Power Regulatory Authority (Nepra).
He further highlighted SEP’s potential to bolster Karachi’s power sector, a city that has long grappled with frequent power outages and supply shortages. He noted that Karachi’s peak season electricity demand stands at a staggering 5,000 megawatts (MW), a figure expected to surge even higher if the entire industry transitions to KE.
