SHANGHAI: President Asif Ali Zardari has invited the Shanghai Electric Power Company to reinvest in Pakistan, assuring that any “outstanding issues” will be resolved amicably and in a spirit of mutual cooperation. The outreach follows Shanghai Electric’s decision to terminate its long-pending offer to acquire a majority stake in K-Electric, citing unfavorable changes in Pakistan’s business environment and the seller’s failure to meet closing conditions.
The President’s assurance came during a meeting with Shanghai Electric Chairman Wu Lei in Shanghai, where he also encouraged the company to explore further investments in modernizing Pakistan’s power grid. Zardari also reaffirmed Pakistan’s commitment to enhancing security for Chinese workers in the country.
Deal’s background and termination
Long-delayed acquisition: Shanghai Electric first agreed to buy a 66.4% controlling share in K-Electric from Abraaj Group in 2016 for $1.77 billion.
Regulatory hurdles: The transaction faced numerous delays due to the seller’s failure to secure necessary approvals and challenges posed by Pakistan’s growing circular debt in the power sector.
Official termination: Shanghai Electric’s board approved the termination of the deal on September 9, 2025, to protect the company’s interests and because the transaction no longer aligned with its international strategy.
Broader cooperation continues
Despite the setback with the K-Electric deal, both parties highlighted ongoing cooperation in other areas. President Zardari witnessed the signing of a Memorandum of Understanding (MoU) for a new coal gasification plant in Thar between Shanghai Electric and local partners. This project is expected to support Pakistan’s energy needs and agricultural sector by producing fertilizers.
Company chairman Wu Lei briefed the Pakistani delegation on Shanghai Electric’s existing projects in Pakistan, including its work in Thar coal, nuclear energy, and coal-fired power plants. In return, the President thanked the company for its contributions to Pakistan’s energy security and socio-economic development.
President Zardari seeks to resolve ‘outstanding issues’ with Shanghai Electric after K-Electric deal collapse
