Shanghai Electric to buy Pakistani power company

State-backed Shanghai Electric Power Co agreed to pay buyout firm Abraaj Group $1.77 billion for a controlling shareholding in Pakistani utility K-Electric, gaining access to 2.5 million customers in the south Asian country’s most populous city.

Abraaj is selling its 66.4 percent stake in K-Electric through its KES Power unit, according to a statement posted on its website, after first investing in the company in 2009. K-Electric was formerly known as Karachi Electric Supply Co and has exclusive power distribution rights for the city and adjoining areas.

The deal is among the biggest acquisitions in Pakistan in a decade. Shanghai Electric Power emerged as the lead bidder last month, people with knowledge of the matter said, after the stake had also drawn interest from Chinese clean-energy group Golden ConcordHoldings Ltd, French utility Engie SA and at least one investment fund, the people said.

Chinese companies have announced $10 billion of overseas utility acquisitions this year, up from $24 million during the same period in 2015, according to data compiled by Bloomberg. State Grid Corp of China agreed in July to buy a $1.8 billion stake in Brazilian power distributor CPFL Energia SA, the data showed. Beijing Enterprises Holdings Ltd reached a deal in February to acquireGermany’sEEWEnergy from Waste GmbH for 1.44 billion euros ($1.6 billion).

Shanghai Electric said in August that it intended to acquire about 18.3 billion shares, or a 66 percent stake, in K-Electric. Citigroup Inc advised Abraaj.

Shanghai Electric Power Co agreed to pay Abraaj Group for a controlling shareholding in Pakistani utility K-Electric