Shanghai Electric Seeks Stake in $2.3 Billion Pakistani Utility

State-backed Shanghai Electric Power Co. said it’s seeking a stake in K-Electric Ltd., the $2.3 billion Pakistani utility, in what could become its largest overseas deal.

The Chinese company is doing preliminary preparation work on acquiring a stake in K-Electric and hasn’t decided how much it will buy, it said in a Shanghai exchange filing Monday. Shanghai Electric Power isn’t the only company competing in the auction, so there’s no certainty it will succeed, according to the filing.

Shanghai Electric Power is vying with Chinese clean-energy group Golden Concord Holdings Ltd. for control of K-Electric, which has also drawn interest from Engie SA and at least one investment fund, people with knowledge of the matter said last week. Bidders were asked to submit binding offers by the end of this month for Abraaj Group’s 66 percent holding in the Pakistani company, according to the people, who asked not to be identified as the information is private.

Any transaction would add to the $129.1 billion of utility deals announced globally this year, up from $60 billion during the same period in 2015, data compiled by Bloomberg show. K-Electric, formerly known as Karachi Electric Supply Co., serves more than 2.2 million customers in and around the Pakistani city and employs about 11,000 people, according to its website

Overseas Foray

A spokeswoman for K-Electric said last week the company hasn’t been notified of any transaction or acquisition. Spokesmen for Abraaj Group and Engie declined to comment, while a representative at Golden Concord didn’t answer phone calls seeking comment.

Acquiring control of K-Electric would be Shanghai Electric Power’s biggest overseas purchase, surpassing its 2014 deal to buy a $399 million stake in Maltese utility Enemalta Plc, according to data compiled by Bloomberg. Abraaj Group’s stake in K-Electric was valued at about $1.5 billion based on the company’s stock price Friday in Karachi.

Pakistan’s government owns another 24 percent stake in K-Electric, the Bloomberg-compiled data show. Abraaj Group, an emerging-markets investment firm with about $9.5 billion of assets under management, bought the controlling stake in K-Electric in 2009, according to its website.

Golden Concord is the parent of Hong Kong-traded GCL-Poly Energy Holdings Ltd., the world’s biggest polysilicon and solar wafer maker, and clean-power producer GCL New Energy Holdings Ltd. Shanghai Electric Power, which has a market value of $3.6 billion, is a listed unit of China’s State Power Investment Corp.