ISLAMABAD: In a dramatic turn of events, the attempt to remove K-Electric’s top leadership fell flat on Wednesday after key shareholder representatives refused to attend a crucial Board of Directors (BoD) meeting here, forcing its cancellation due to lack of quorum.
The meeting, scheduled for 2pm, was officially called to discuss “non-financial matters,” but insiders confirmed it was in fact convened to start search for new chief executive officer of the K-Electric. Government-nominated directors showed up, but the private shareholders — who hold the majority stake in the company — stayed away, effectively derailing the move.
“The intent was to replace the existing CEO over performance concerns,” a senior Power Division official told The News. “But without the participation of shareholder directors, the meeting simply could not proceed.”
The Pakistan Stock Exchange (PSX) later on Wednesday informed that the meeting was not held “due to lack of quorum,” directing TRE certificate holders to be informed accordingly.
Earlier, on October 27, the BoD had communicated the agenda to its members for considering filling the positions of chief financial officer and chief distribution officer within a week time, beginning the search for a new CEO, and reaffirming that the company would not become a party to any international arbitration, opting instead to operate strictly within Pakistan’s multi-year tariff legal framework.
When contacted, a Power Division spokesman declined to comment on the development, saying he was “not the spokesman of K-Electric” and, therefore, could not speak about a meeting called by the company’s board, even if government representatives were involved.
Meanwhile, the company secretary of K-Electric confirmed that the PSX had been informed on Wednesday that the BoD meeting was scheduled to consider “non-financial matters,” but that it could not be held due to lack of quorum. He, however, did not respond when asked whether the government-nominated directors on the board had sought the removal of CEO Syed Moonis Abdullah Alvi.
The aborted meeting has sparked unease among K-Electric’s principal foreign investors — Saudi Arabia’s Al Jomaih Group and Kuwait’s Denham Investments Limited — which just weeks ago served a $2 billion legal notice on the Pakistan government under the OIC Investment Agreement.
Sources said the investors viewed the latest government move as a “hostile action,” especially as both sides are engaged in delicate, high-level negotiations to resolve multiple long-standing disputes. “This action has come at the worst possible time,” an official close to the talks remarked, warning it could further erode investor confidence in Pakistan’s energy sector.
The episode unfolds as K-Electric continues to challenge Nepra’s decision to slash its multi-year tariff by Rs7.60 per unit, bringing it down to Rs32.37 from Rs39.97. The Sindh High Court recently extended a stay order against the tariff cut after K-Electric argued the reduction would make its operations financially unsustainable.
While the Power Division claims that the 2,000 megawatts supplied from the national grid cushions the company, industry experts counter that K-Electric actually helps the federal government by absorbing excess generation capacity charges. They also point out that K-Electric consumers are paying Rs3.23 per unit as a Power Holding Limited (PHL) surcharge — part of the circular debt burden that largely stems from inefficiencies in state-run power distribution companies.
