KARACHI: As Shanghai Electric Power (SEP) has renewed its commitment to acquire 66.40% shares in K-Electric (KE) for $1.77 billion, Shan A Ashary, the Saudi Group’s investment advisor and Ex-chairman KE, has said that a fresh offer will be given, and the deal with SEP should to go up to $ 2 billion now.
Talking to reporters here, Shan A Ashary said China’s state-owned SEP has been agreeing to acquire 66.40% shares in the Karachi-based power company for the last many years; however, things have changed. We have brought in tangible improvement in the power company through mega investment in the last few years. We want to come up with new offer. We wish that the deal should go up to $2 billion approximately,“ he said.
Once the deal is done, people of Karachi, the economic and commercial hub of Pakistan, will benefit, as the Chinese investors have capability and expertise to further improve the power sector of the port city, he said.
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Currently, the electricity demand of Karachi stands at 5,000-mw [at peak season]; however, if the entire industry shifts into KE, the demand will increase, rapidly.
To a question, he said the KE ownership dispute has been going on for the past few months. At present, Saudi Arabia’s Aljomaih Holding Company, and Kuwait’s National Industries Group (NIG) are the largest shareholders of the K-Electric. Aljomaih and NIG hold 47 percent shares in KES Power, which constitute 30 percent in K Electric, he said.
It is relevant to mention here that Asia Pak Investments claimed to have acquired 54 percent shares in KE; however, Shan A Ashary claimed that shares of Asia Pak Investments in KE are not more than 5%, and he added that KE is ready to offer one slot for Asia Pak in its board.
He said KE board is fully functional. Board meetings are going on, and the plan regarding intensive investment in Karachi has also been submitted to National Electric Power Regulatory Authority (Nepra).
He added that Infrastructure Growth and Capital Fund (IGCF) has more than 80 existing investors, and the Mashreq Bank’s 30 percent shareholding position in IGCF is still retained.
If any potential Pakistani investor wants to join us legally, we will welcome him. Compared to Europe, Pakistan is the best place for Saudi and other Gulf countries to invest as the rate of return in Pakistan is higher, he said.
To another query he said that establishment of Special Investment Facilitation Council (SIFC) is a ray of hope for the investors. SIFC’s announcements regarding one-window operation and facilitating foreign investors is a good move in the right direction.
He said he had convened meeting with SIFC officials wherein the Aljomaih’s issue was raised. But, no practical steps have been taken to resolve the pending issues, yet.
Copyright Business Recorder, 2023
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