The privatisation of Islamabad Electric Supply Company (IESCO) has attracted strong interest from domestic and international investors, with the Privatisation Commission receiving 10 Expressions of Interest to acquire a 51% to 100% stake in the power distribution company, along with management control.
Three Turkish energy companies and seven Pakistani investors or consortiums submitted the Expressions of Interest, as the deadline for participation in the IESCO privatisation process expired on Monday.
The three Turkish companies that submitted EOIs are Aktor Elektrik Enerji Yatırımları San. ve Tic. A.Ş., Genvera Enerji A.Ş. and Cengiz Enerji Sanayii ve Ticaret A.Ş.
Engro Energy Limited has also formally expressed interest in acquiring a controlling stake in IESCO.
Among the Pakistani groups, an Artistic Milliners (Private) Limited-led consortium comprising The Lake City Holdings, Fatima Capital Limited, Din Ventures (Pvt) Limited and Fazal Cloth Mills Limited submitted an EOI.
A consortium led by Hub Power Holding Limited has also entered the process. Its members include Lucky Cement Limited, Kohat Cement Limited and Metro Ventures (Private) Limited.
Sapphire Fibres Limited, Novatex Limited and Bestway Cement Limited have separately submitted Expressions of Interest to the Privatisation Commission.
Another consortium led by Hasnaat Brothers Construction Co. (Pvt) Limited has also expressed interest. The consortium includes Dhilal Holding Group, Pak Steel, Bio-Labs (Pvt) Limited and Farid Steel Casting (Pvt) Limited.
The participation of Turkish energy companies alongside some of Pakistan's prominent business groups has added momentum to the government's programme to bring private-sector participation into electricity distribution companies.
The Privatisation Commission said the 10 potential investors are seeking to acquire between 51% and 100% of IESCO's shareholding together with management control.
The government had formally invited local and international investors to participate in the privatisation of IESCO, Faisalabad Electric Supply Company (FESCO) and Gujranwala Electric Power Company (GEPCO), which form the first batch of electricity distribution companies included in the privatisation programme.
The transaction structure allows successful investors to acquire a controlling stake ranging from 51% to the entire share capital of the relevant distribution company.
The Privatisation Commission had earlier extended the deadline for submission of EOIs for IESCO to September 21 to provide prospective investors additional time and encourage greater competition in the transaction.
Adviser to the Prime Minister on Privatisation and Privatisation Commission Chairman Muhammad Ali described the response to IESCO as an important milestone in the privatisation of power distribution companies.
He said the number and profile of interested investors reflected confidence in the potential of Pakistan's electricity distribution sector as well as the government's commitment to conducting the process in a transparent and competitive manner.
The commission said domestic and international roadshows held during recent months had helped generate investor interest in the government's power-sector reform programme.
With the submission stage now completed, the Expressions of Interest and Statements of Qualification filed by all interested parties will undergo a detailed evaluation against the approved pre-qualification criteria.
Applicants meeting the required financial, technical and other conditions will be formally pre-qualified for the next stage of the transaction.
The pre-qualified investors will then be granted access to a Virtual Data Room, allowing them to conduct detailed buy-side due diligence of IESCO's financial, operational, legal and other information before the process advances further.
The Privatisation Commission said it would engage with pre-qualified parties during the due-diligence stage and discuss the framework for the post-privatisation regime.
The government says the broader DISCO privatisation programme is intended to improve operational efficiency, modernise electricity distribution infrastructure, strengthen customer service, reduce distribution losses and move the power sector towards greater financial sustainability.
IESCO is the third company in the first batch of distribution companies being moved through the privatisation process.
The Privatisation Commission has already pre-qualified 10 interested parties for the privatisation of FESCO, while 11 Expressions of Interest received for GEPCO are undergoing evaluation.
The receipt of 10 EOIs for IESCO means all three companies in the first batch have attracted participation from multiple domestic and international investors, moving the government's DISCO privatisation programme into its next phase.
Reporter: Waqas Azeem