Shanghai Electric Power has officially called off its $1.77 billion deal with K-Electric, ending years of uncertainty around one of Pakistan’s biggest planned energy sector investments.
The deal was meant to give Shanghai Electric a 66.4% majority stake in K-Electric by buying shares from KES Power Limited. It was first announced several years ago and was seen as a major step toward improving Pakistan’s electricity infrastructure. However, the agreement faced repeated delays due to regulatory approvals, legal disputes, and policy hurdles.
On September 11, Shanghai Electric informed the Shanghai Stock Exchange that it has decided to withdraw from the acquisition. This decision officially closes the chapter on what was once considered a landmark transaction for Pakistan’s power industry.
The cancellation is viewed as a setback for the energy sector, especially at a time when Pakistan continues to face rising electricity demand, financial stress in power companies, and the need for fresh investment in infrastructure.
The deal had raised hopes of new technology, improved efficiency, and stronger financial backing for K-Electric, which provides electricity to Karachi, the country’s largest city.
Despite the setback, industry observers say that this may not be the end of the story. Stakeholders have suggested that talks could reopen in the future under revised terms if both sides find common ground.
For now, the cancellation reflects the challenges foreign investors face in Pakistan’s energy market, highlighting the need for clearer regulations and smoother approval processes to attract long-term global investment.
