By Staff Reporter
ISLAMABAD: Pakistan’s plan to sell control of a second state-owned power distributor attracted expressions of interest from 11 investors, as the government presses ahead with an overhaul of a electricity distribution network burdened by losses and unpaid bills.
The Privatisation Commission said Friday it received the bids by the deadline for Gujranwala Electric Power Co., known as Gepco, from a mix of Turkish, Saudi Arabian and Pakistani parties seeking stakes of 51% to 100% along with management control. The response builds on interest shown earlier this month in Faisalabad Electric Supply Co., or Fesco, the first of three distributors the government is seeking to sell in its initial privatization batch.
Four of the Gepco bids came from foreign investors: three Turkish companies — Aktor Elektrik Enerji Yatırımları San. ve Tic. A.Ş., Genvera Enerji A.Ş. and Cengiz Enerji Sanayii ve Ticaret A.Ş. — and Saudi Arabia’s Al Sharif Contracting and Commercial Development Co. All three Turkish firms had also bid for Fesco.
Unlike Fesco, which drew a bid from a Chinese investor, Gepco attracted no Chinese interest.
Seven Pakistani business groups submitted bids for Gepco, including Engro Energy Ltd., Sapphire Fibers Ltd., Hub Power Holdings, Lucky Cement, Shirazi Investments (Pvt) Ltd., Artistic Milliners (Pvt) Ltd., Fatima Group, K-Electric Ltd. and a consortium of AKD Securities, Fast Cable and Mughal Steel Group. Fatima Group was among the buyers of Pakistan International Airlines in a landmark sale in December.
All the local bidders except the AKD-led consortium are also competing for Fesco. Three groups that bid for Fesco — Maple Leaf Cement and Kohinoor Textile, Nishat Mills Ltd. and Pak Elektron Ltd. — did not submit interest in Gepco.
“The strong response for Gepco is indicative of investor confidence in the potential of Pakistan’s electricity distribution sector and in the government’s commitment to a transparent, competitive and professionally managed process,” Muhammad Ali, the prime minister’s adviser on privatization and chairman of the commission, said in the statement.
The commission said it would move to evaluate the bids against prequalification criteria, with successful applicants gaining access to a virtual data room to conduct due diligence. Ali said the commission looks forward to discussing the terms of a post-privatization regime with prequalified bidders.
Gepco is one of three power distributors in the government’s first privatization batch, along with Fesco and Islamabad Electric Supply Co., or Iesco. Fesco drew 12 expressions of interest by its Aug. 7 deadline, including bids from three Turkish consortiums, a Chinese investor group and eight Pakistani business groups. The deadline for Iesco bids is Sept. 7.
The three distributors are considered the most commercially viable among 11 that were carved out of the state-run Water and Power Development Authority in 1998.
JDW Sugar Mills Ltd., one of Pakistan’s largest sugar producers, said Thursday it had joined a 10-member consortium led by Pakgen Ltd. to bid for Fesco. The group, which includes Nishat Mills, Lalpir Ltd., Nishat Power Ltd., Nishat Chunian Power Ltd., Kohinoor Energy Ltd., Pak Elektron, Deharki Sugar Mills and ATF Agri Sciences, filed the disclosure with the Pakistan Stock Exchange. JDW said its participation remains subject to prequalification and regulatory approval and doesn’t constitute a binding commitment.
The distributor sales are part of Pakistan’s 2024-2029 privatization program, which aims to shrink the state’s footprint in loss-making enterprises. The effort gained traction in December when a consortium led by Arif Habib Corp. acquired a 75% stake in Pakistan International Airlines for 135 billion rupees in a televised auction — a breakthrough after a 2024 attempt collapsed when the government received only one bid, for 10 billion rupees, well below its minimum price.
Ahead of the successful sale, authorities restructured PIA’s balance sheet, shifting much of its legacy debt away from core operations to make the carrier more attractive to buyers.
The privatization drive has gained urgency under an International Monetary Fund-backed economic program that has pushed Pakistan to overhaul state-owned enterprises and the energy sector to curb fiscal risks. The commission has hired financial advisers to run due diligence and structure the Fesco, Gepco and Iesco transactions, which represent an early test of investor appetite for one of the power sector’s most troubled segments.
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