K-Electric reports shareholder rift over alleged stake sale to Saudi Investor

October 16, 2025 (MLN): K-Electric Limited (PSX: KEL), Karachi’s sole power utility, has reported an intensifying dispute among its indirect shareholders following media claims that a majority stake in its parent company, KES Power Limited (KESP), may be sold to a Saudi investor.

The company submitted a clarification to the Pakistan Stock Exchange (PSX) today, attaching a letter from Al-Jomaih Power Limited (AJP), one of KESP’s shareholders, which directly contradicts reports of a concluded deal.

According to the filing, K-Electric sought clarification from KESP after media outlets reported that one of its indirect shareholders had signed a Memorandum of Understanding (MoU) with a Saudi investor for the sale of its interest in KESP. KESP is the majority shareholder of K-Electric, holding a 66.40% ownership stake.

In response, a director of KESP representing AJP stated that they were “not aware of any transaction for the sale of shares in KESP” apart from what was published in the media. The letter added that “no information has been provided to the Board of KESP or to the shareholders of KESP.”

AJP’s representative further asserted that businessman Shaheryar Chishty, who has been engaged in a long-running legal dispute with other KESP shareholders, “does not own any shares in KESP and so he cannot sell any shares.”

The actual shareholders of KESP, the letter reiterated, are Al-Jomaih Power Limited (AJP), Denham Investments Limited, and IGCF SPV 21 Limited (SPV 21).

The letter also alleged that Mr Chishty has sought to take control of SPV 21, one of KESP’s shareholders, in violation of the Shareholders’ Agreement (SHA), which prohibits any change of control of SPV 21 without prior consent from AJP and Denham.

Referring to a July 31, 2025, ruling by the Grand Court of the Cayman Islands, AJP’s director noted that the court found a “serious issue to be tried” regarding whether SPV 21 breached the SHA by permitting Mr Chishty to assume control. The court held that any such attempt would constitute a breach of the agreement.

The letter concluded with skepticism toward the reported transaction, suggesting the announcement was “likely little more than a photo opportunity intended to influence public opinion in Pakistan.”

K-Electric clarified that it has not yet received an official response from KES Power Limited to its request for confirmation or clarification.

Background:
K-Electric is listed on the Pakistan Stock Exchange, while its majority shareholder, KES Power Limited, owns a 66.40% stake in the utility.

The shareholders of KESP include Al-Jomaih Power Limited, Denham Investments Limited, and IGCF SPV 21 Limited, a fund controlled by AsiaPak Investments, an entity linked to Mr Chishty.

AsiaPak acquired SPV 21 from Abraaj’s liquidators in 2022 and currently holds a 53.8% stake in KESP.

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