Shanghai Electric to buy K-Electric for $1.6 billion

[Furqan Sarwar]

Shanghai Electric to buy K-Electric for $1.6 billion

Chinese multinational Shanghai Electric is set to buy the utility serving Pakistan’s biggest city of Karachi, in a US$1.6 billion deal that will be the biggest private-sector acquisition in the country’s history.

China is stepping up investment in its South Asian neighbor as part of a $46bn project unveiled last year that will link its western Xinjiang province to Pakistan’s Gwadar port with a series of infrastructure, power and transport upgrades.

"We have received the public announcement of intention for acquisition of up to 66.4 per cent of the shares of K-Electric Limited by Shanghai Electric Limited," a Pakistan Stock Exchange notification said.

The Karachi Electric Corporation, set up in 1913 as a public-sector company, was sold to Saudi Arabia’s Aljomaih Group in 2005, who in turn sold it to the UAE’s Abraaj Capital.

"Chinese interest is tremendous in Pakistan and the new deal would be quite attractive to strengthen cooperation under CPEC," said Taha Javed, director of research at Alfalah Securities, referring to the China-Pakistan Economic Corridor.

"It is the largest ever private-sector acquisition in Pakistan," said analyst Zeeshan Afzal, executive director at Insight Securities.

Pakistan suffers from major power shortages that sap economic growth. Analysts hope the Chinese acquisition can improve the utility’s efficiency and reduce blackouts.

Source: https://defence.pk/threads/k-electric-on-sale.446676/#ixzz4IvZHccGX

 

[Ghazwa e Hind]

1.6 billion $ is peanuts. Real credit goes to those who privatized this institution.

 

[Furqan Sarwar]

1.6 billion $ is peanuts. Real credit goes to those who privatized this institution.

Yup, Now if Govt can privatize Steel Mill as well then it would be great.

 

[Ghazwa e Hind]

Yup, Now if Govt can privatize Steel Mill as well then it would be great.

You should not demand more. They are already selling enough resources. Vital organs of kidnapped children are being smuggled to KSA and other rich countries. Let them do this job.

 

[Mrc]

The normal pakistani pessimism apart...this is a good news

 

[AZADPAKISTAN2009]

Normally , when a region is expect to blossom , Investors normally sweep in about 4-5 Years ahead of maximum potential , to get best financial deals


Considering that National Electric production will be resolved successfully in 2-3 years time , the Electric consumption will sky rocket due to Industrial usage

1.6 Billion is on a cheap side for Electric company however reasonable (The funds don't add anything to Pakistani GDP) they are buying it from a private buyer

The private owner will certainly have chance to make quick "Profit"

The benefit would be on the future infrastructure needs

Certainly if investor is found for Steeles Mills that would create many jobs

 

[Furqan Sarwar]

KARACHI: The Federal Board of Revenue (FBR) has frozen bank accounts of K-Electric for holding onto taxes collected from customers.

According to Chief Commissioner LTU II, K-Electric collected Rs. 677 million under the head of default surcharges from its customers. The withhold amount was not transferred to FBR despite various notices.

The board using its powers, directed banks to freeze all K-Electric accounts. FBR collected Rs 350 million from nine frozen accounts and is working for the recovery of the remaining amount.

When contacted a spokesman from K-Electric denied that the accounts had been frozen.