KARACHI: Kot Addu Power Company Ltd (Kapco) announced on Friday that the Water & Power Development Authority (Wapda), which holds 40pc majority stake in the independent power producer had requested to put on hold the proceedings for acquisition of 201m shares or 17.37pc of Hub Power Company Limited equity.
In a stock exchange filing Kapco explained that the transaction was suspended “due to requirement of a special resolution to proceed with the transaction”. The company was in talks to finalise a Share Purchase Agreement (SPA) with Dawood Hercules and some other shareholders offloading 17.37pc stake in Hubco.
Kapco recalled that the company had disclosed on Oct 27, the entering, subject to required corporate and regulatory approvals, into share purchase agreements (SPAs) for the acquisition of 201.1m shares in Hubco that were being offered for sale by Dawood Hercules Corporation Limited and other shareholders.
Accordingly, the board of Kapco had now decided to postpone the planned Dec 2 extra ordinary general meeting (EOGM).
Analysts at Arif Habib Ltd said the transaction had been delayed on account of some pending necessary approvals.
As the transactions was to be fully financed by Kapco through debt of Rs22bn, the analysts calculated that after adjustments of Rs1.11bn as expected finance costs at 7.75pc against expected dividend income from Hubco and Kapco amounting to Rs1.95bn, the net positive impact on Kapco bottom line would have amounted to Rs844m.
Published in Dawn, November 11th, 2017
