The government is preparing to establish a new government owned Special Purpose Vehicle with authorized share capital of Rs. 250 billion to facilitate the privatization of Faisalabad Electric Supply Company, Gujranwala Electric Power Company and Islamabad Electric Supply Company, according to sources in the Power Division.
The proposed SPV will be used to carve out selected assets and liabilities of the three power distribution companies and create a structure that can support their privatization. The move follows a July 28 recommendation by the Privatisation Commission Board to approve restructuring plans and schemes of arrangement for the three Discos.
Based on audited financial statements for the period ended March 31, 2026, the assets proposed to be transferred to the SPV are valued at Rs. 350.6 billion, while liabilities stand at Rs. 313 billion. This would leave equity of Rs. 37.6 billion in the proposed structure.
The restructuring plans are intended to improve the commercial viability of the transactions and maximize value for the government while making the three Discos more attractive to private sector investors. The Privatisation Commission Board has also been informed of interest from domestic and international investors.
The government is expected to direct NEPRA to register the SPV and a separate pension fund for liabilities associated with employees covered by the restructuring. The registration would allow the relevant pension liabilities of retirees to be recovered through electricity tariffs. The government also plans to allow the lease of land associated with the transactions.
FESCO, GEPCO and IESCO will also increase their authorized share capital to Rs. 100 billion, Rs. 75 billion and Rs. 125 billion, respectively. Their combined authorized share capital will therefore reach Rs. 300 billion. The Securities and Exchange Commission of Pakistan is expected to waive the applicable fees on these increases as well as the authorized share capital of the new SPV.
The three Discos have also been directed to complete the classification of the land they currently use into core and non core categories by the end of August. Relevant government agencies and authorities will be required to provide approvals and take corporate actions needed to implement the restructuring plans and file the schemes of arrangement.
The government has already set separate deadlines for expressions of interest from potential investors. The deadline was August 7 for FESCO, August 21 for GEPCO and September 7 for IESCO, according to the report.
The post Govt Plans New Rs. 250 Billion Entity for FESCO, GEPCO, IESCO Sale appeared first on ProPakistani.