12 Pakistani and foreign groups submit bids to acquire Fesco in landmark privatisation push

Twelve business groups, including eight prominent Pakistani conglomerates and four foreign firms, have formally expressed interest in acquiring majority stakes in the Faisalabad Electric Supply Company (Fesco), marking the government’s most serious attempt in a decade to privatise the profitable power distribution utility.

The Privatisation Commission released the list of interested parties on Friday after the extended deadline for expressions of interest closed. The development represents a major milestone for Pakistan’s long delayed plan to sell off state owned power distribution companies, a process that stalled in 2016 when the previous government abandoned the sale just before bidding began.

The federal cabinet has already authorised the sale of majority stakes in three of the country’s most profitable power distribution companies, positioning Fesco as the first test case in the broader privatisation drive.

Local business families dominate interest

Eight of the twelve groups that submitted expressions of interest are well established Pakistani business families with deep roots in energy, textiles, automobiles and cement manufacturing. A consortium formed by Nishat Mills, controlled by one of Pakistan’s wealthiest businessmen, Mian Mohammad Mansha, and Pak Elektron Limited, owned by the Saigal family, has entered the race. Mansha also participated in the failed 2015 to 2016 bidding round for the same company.

The Saigal family additionally submitted separate bids through Maple Leaf Cement and Kohinoor Textile Mills, giving the family multiple entry points into the process.

Other major local contenders include Engro Energy Limited, part of the Dawood family’s diversified business empire, and Sapphire Fibers Limited, owned by the Abdullah family. Hub Power Holdings, controlled by the Habibullah Khan family and already a significant player in Pakistan’s power sector, has also thrown its hat in the ring, alongside Lucky Cement, owned by the Mohammad Ali Tabba family. Lucky Cement previously finished as runner up in the privatisation of Pakistan International Airlines.

Shirazi Investments, which also holds interests in the automobile sector, and Artistic Milliners, owned by the Yaqoob family, rounded out the list of local applicants. K-Electric, Pakistan’s largest integrated power generation and distribution company, submitted documents as well, even as its Saudi and Kuwaiti shareholders pursue international arbitration against the government over a blocked 1.7 billion dollar Chinese investment in the company.

Foreign firms from Turkey and China join the race

Four international firms rounded out the list of interested parties. Three Turkish companies, Aktor Elektrik Enerji Yatirimlari, Genvera Enerji (part of the Celik Group) and Cengiz Enerji Sanayii ve Ticaret, submitted bids alongside Chinese firm Jiang Xi Electric Power Construction.

Officials noted that firms qualifying technically and financially for Fesco will also be eligible to bid for two additional distribution companies, Gujranwala Electric Power Company and Islamabad Electric Supply Company, if they fail to win Fesco. This flexibility likely contributed to the strong turnout, as qualified investors gain multiple chances to enter Pakistan’s power distribution market.

Government hails strong investor response

Muhammad Ali, Adviser to the Prime Minister on Privatisation and Chairman of the Privatisation Commission, called the response a significant milestone in the broader privatisation of state owned distribution companies. He said the strong interest in Fesco reflects investor confidence in the growth potential of Pakistan’s electricity distribution sector and in the government’s commitment to running a transparent and competitive process.

Ali added that the commission will now engage with prequalified investors through detailed due diligence and begin discussing the structure of the post-privatisation regulatory regime. He said the sale aims to improve operational efficiency, modernise ageing distribution infrastructure, strengthen customer service and reduce financial losses across the sector, ultimately supporting more competitive electricity distribution and more affordable, reliable power for consumers.

The expressions of interest and accompanying statements of qualification will undergo evaluation against the prequalification criteria set by the commission. Groups that meet the requirements will move to the next stage, gaining access to a virtual data room to conduct detailed buy side due diligence on Fesco’s operations and finances.

Concerns remain over guaranteed returns and uniform pricing

Despite the enthusiastic response, some analysts have raised concerns about the government’s proposal to guarantee investors a minimum return of 13 percent, warning that such guarantees could discourage efficiency gains and slow technological upgrades at the privatised utility. Questions also remain over whether the government will maintain uniform electricity pricing nationwide after privatisation, a policy that would keep subsidy costs on the federal budget rather than shifting the burden fully to market pricing.

Fesco is one of three companies included in the first batch of distribution company privatisations, alongside Gepco and Iesco. The deadline for expressions of interest in Gepco is set for 21 August 2026, while Iesco’s deadline falls on 7 September 2026.

Fesco’s financial position underscores its appeal

Financial data from the finance ministry’s Central Monitoring Unit shows Fesco held total assets worth 410.3 billion rupees as of June last year, against liabilities of 347 billion rupees. The company posted net positive equity of 63 billion rupees, which climbed 28 percent due to share deposits and asset revaluation gains.

Non-current liabilities stood at 217.6 billion rupees, with staff retirement benefits accounting for the largest share at 123 billion rupees. Current liabilities totalled roughly 130 billion rupees, including trade payables of 118 billion rupees. The company reported a profit after tax of 9.4 billion rupees for the period.

With twelve qualified groups now in the running, the Fesco privatisation stands as a critical test of investor appetite for Pakistan’s power sector reforms and could shape the pace and structure of future electricity distribution company privatisation efforts.