Abraaj Mandates Citi to Evaluate Options for K-Electric Stake

The Abraaj Group, a private-equity company managing $7.5 billion in emerging-market investments, has hired Citigroup Inc. to evaluate “strategic options” for its stake in K-Electic Ltd., an integrated power utility in Pakistan.

Abraaj acquired a controlling share in K-Electric in 2009 through its investment in KES Power Ltd., the majority shareholder of K-Electric, it said in an e-mailed statement from Dubai today. KES Power’s 77 percent stake in K-Electric, the monopoly power supplier in Karachi, is valued at $1.64 billion at today’s closing price, according to data compiled by Bloomberg.

K-Electric reported its first profit in 17 years in the 2012 fiscal year, Abraaj said in the statement. The company has added more than 1,000 megawatts of power-generating capacity since 2009, it said.

Abraaj, founded in 2002, is also seeking to boost investments. The company, along with TPG Capital, is negotiating with banks to borrow about 700 million Saudi riyals ($187 million) to fund the potential acquisition of Saudi fast-food chain Kudu, three people with knowledge of the matter said this month.

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