By [Reporter Name], Bloomberg
ISLAMABAD: The government cleared 10 companies to bid for control of Faisalabad Electric Supply Co. after the country’s only privately run utility withdrew from the contest and a Chinese firm was disqualified on a technicality, advancing Prime Minister Shehbaz Sharif’s push to sell off state power distributors.
The Privatisation Commission Board approved the prequalified bidders on Friday, whittling down a field of 12 expressions of interest for the utility known as Fesco. K-Electric Ltd., the sole privatised distributor in a sector otherwise run by the state, pulled its application rather than risk disqualification over gaps in its audited financials, according to people familiar with the matter.
Jiangxi Electric Power Construction Co. of China missed the cut after submitting its paperwork in Chinese rather than English on the final day of the deadline, despite repeated requests from officials to resubmit in English, the people said.
The move is part of a broader effort by Sharif’s government to overhaul Pakistan’s debt-laden power sector, which has long been weighed down by distribution losses, unreliable service and financial strain across state-run utilities. Earlier this month, the prime minister directed authorities to pursue what he called a “comprehensive strategy” to draw international investors to the privatisation program and to complete a restructuring of the Privatisation Commission within a month.
K-Electric confirmed its withdrawal in a statement. “K-Electric has withdrawn its Expression of Interest for Fesco’s privatisation,” a spokesperson said, citing the unavailability of audited financial statements pending finalisation of the company’s multi-year tariff, a process the spokesperson said was outside the company’s control. “We remain committed to pursuing opportunities that maximise value for our stakeholders,” the spokesperson said.
People familiar with the matter said K-Electric intends to instead pursue a separate distribution company as part of a consortium with AsiaPak Investments, the firm controlled by Shahryar Chishti, one of K-Electric’s largest shareholders.
The board, chaired by Privatisation Commission Chairman Muhammad Ali, who also serves as the prime minister’s adviser on privatisation, was told that a financial adviser had recommended 10 of the 12 applicants for prequalification following a review against approved criteria.
Three of the prequalified bidders are based in Turkey: Aktor Elektrik Enerji Yatırımları San ve Tic AŞ, Genvera Enerji AŞ, part of the Celik Group, and Cengiz Enerji Sanayii ve Ticaret AŞ.
The remaining seven are Pakistani groups: Engro Energy Ltd.; a consortium of Sapphire Fibres Ltd., Hub Power Holdings, Lucky Cement and Metro Ventures; Shirazi Investments (Pvt) Ltd., part of the Atlas Group; a pairing of Maple Leaf Cement and Kohinoor Textile; the Pakgen Ltd. consortium, which includes Nishat Mills, Nishat Power, Nishat Chunian, Lalpir, Pak Elektron Ltd. and Kohinoor Energy; and Artistic Milliners (Private) Ltd.
The approved bidders will move to the next phase of the sale process, gaining access to a virtual data room for detailed due diligence, the commission said. The board also signed off on reconstituting its audit and risk, human resources, investment and legal committees.
The commission said the sale is designed to improve operational efficiency, modernise distribution networks, strengthen customer service, cut losses and put the power sector on a more sustainable financial footing, adding that the changes should eventually support more competitive electricity distribution and more affordable, reliable service for consumers.
Fesco is one of three distribution companies in the first batch of utilities being privatized, alongside Gujranwala Electric Power Co., which drew 11 expressions of interest, many from the same bidders competing for Fesco, and Islamabad Electric Supply Co., for which the deadline to submit interest is Sept. 7.
The commission said it would run an open, transparent and competitive process in the public interest, in support of the federal government’s broader power-sector reform agenda.
The privatisation push comes as Pakistan’s power regulator moves to tighten oversight of distribution companies regardless of ownership. The National Electric Power Regulatory Authority this week notified sweeping new performance standards for all distribution companies, the first overhaul in more than two decades, aimed at ensuring compliance even after utilities pass into private hands.
The Performance Standards (Distribution) Regulations 2026, issued after nearly two years of consultation with stakeholders, replace rules dating to 2005. For the first time, utilities will face mandatory compensation payments to consumers, along with heavy fines, if they miss strict deadlines for restoring power after outages, replacing faulty meters, addressing voltage fluctuations and providing new connections, among other services.
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