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Sunday April 21, 2024

CCP approves investment of Korean company in hydropower sector

By Mehtab Haider
February 20, 2024

ISLAMABAD: The Competition Commission of Pakistan (CCP) has approved a merger that will see a Korean company investing in Pakistan’s hydropower sector.

This photograph shows a general view of the Neelum-Jhelum Hydropower Project in Nosari, in Kashmir’s Neelum Valley. — AFP/File
This photograph shows a general view of the Neelum-Jhelum Hydropower Project in Nosari, in Kashmir’s Neelum Valley. — AFP/File

The transaction involves Korea-based M/s. DL E&C Co. Ltd (acquirer) acquiring shares in Pakistani company M/s Mira Power Limited (MPL), which operates the 102 MW Gulpur hydropower plant, from M/s. DL Holdings Co. Ltd (Seller). The acquirer is a Korean-registered company, which mainly operates as a construction company, and also provides engineering, procurement, and construction solutions in South Korea and other international destinations. On the other hand, MPL is a public limited company (Unlisted) existing under the laws of Pakistan. MPL is a subsidiary of Korea Energy (KOEN), a South Korean-based electricity generating company. MPL has been successfully generating power since 2020 in Pakistan via the 102 MW Gulpur hydropower plant located in Kotli district, Azad Jammu & Kashmir.

MPL had submitted a pre-merger application to the CCP under Section 11 of the Competition Act, 2010. Both the Acquirer and Seller entered into a Share Purchase Agreement for the sale of shares back in July 2023. In its competition assessment, CCP determined that MPL’s estimated share in the market is less than 1pc, and this transfer of ownership will not result in any modification of the MPL’s presence in the market.

The proposed transaction will not lead to the dominance of the acquirer in the relevant market post-transaction, and therefore, the merger was authorised. Moreover, it is a significant vote of confidence in international investors’ appetite for the Power Sector in Pakistan.