KARACHI  - The management of KESC has categorically refuted allegations & negative propaganda on behalf of the report of Senate’s standing committee.

The Karachi Electric Supply Company has categorically termed allegations raised against it by Senate’s Standing Committee on Water and Power as completely baseless. In a statement KESC said that all such allegations as reported in media are false propaganda and without any justification. Such negative propaganda has a direct adverse impact on Pakistan’s attempts to woo foreign investors to come to Pakistan. KESC clarified that its privatisation took place in accordance with all applicable laws on November 29, 2005, after all relevant approvals were in place from the ECC, Cabinet and CCI.

The subsequent induction of Abraaj Capital as new shareholder in KES power in 2009 after the lapse of 3 years from the date of privatisation was legally in order.

This was not a new privatisation transaction as no fresh shareholding from GoP was transferred into private ownership and the existing privatised shareholding of KES Power in KESC remained unchanged and was therefore in compliance with all applicable laws. The new shareholder obtained a proportionate shareholding in KES Power to reflect their investment of fresh equity and funds into KESC. It is relevant to point out that since May 2009, Abraaj Capital has already invested $361 million for purposes of adding new generation capacity (1010 MWs) and rehabilitation of network infrastructure which complies with their obligations under the Amendment Agreement between the Government of Pakistan and KESC in April, 2009. Since that date, the overall investment in KESC through debt and equity is around $1 billion.

KESC emphasised that the privatisation of KESC in 2005 was in compliance with all local laws and the induction of a new shareholder after the lapse of 3 years from privatisation in KES Power, which is the sponsor shareholder in KESC, was in accordance with all applicable laws.