Kapco’s share purchase agreement with Dawood Hercules falls apart

KARACHI: The share purchase agreement (SPA) signed between Kot Addu Power Company Ltd (Kapco) and Dawood Hercules Corporation and ‘other shareholders’ has fallen apart, a stock exchange filing said on Friday.

Kapco had signed the SPA for the acquisition of 201 million shares (approximately 17.37pc) in Hub Power Company (Hubco).

The completion of the transaction was conditional upon the fulfilment of requisite corporate and regulatory conditions precedent. “Since the time allowed for the completion of the conditions stated in the SPA have not been initiated/completed/fulfilled, the parties have mutually agreed to terminate the SPA and further processing of the transaction,” the company said.

Cyan Ltd and Dawood Hercules confirmed in their separate announcements the SPA’s termination. Cyan Ltd said it had signed the SPA with Kapco for the sale of 10m shares of Hubco.

Dawood Hercules stated that the SPA with Kapco envisaged the sale of its entire shareholding, representing 14.9pc of the issued and paid-up capital in Hubco.

Published in Dawn, December 9th, 2017

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Comments (2) Closed

farrukh

Dec 10, 2017 07:03am

so wapda said no why? share price is down to 50 never buy a governmebt owned company as government is too selfish to care about share holders benefit.why cant wapda let them do ppa? why cant wapda let kapco buy shares in hubco?there is no logic except it's another pia where government officials fight with each other about who gets get.kapco has rlng(enough fuel efficient) why is ppa not being extended? if government is finishing kapco can they openly say it and extend ppa for 3 years so share holders which is pakistani public dont lose money?or is this part of market manipulation where certain individuals are on purpose bringing share down and ultimately near 2021 ppa will be extended by their friends in the government and those certain people will make lot of money.This is beyond ridiculous when government officials are trying very best to bring down our own assets and they dont care their inefficiency caused share price to fall from 90 to 50.great work.

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Brainiac

Dec 11, 2017 08:06am

@farrukh had you read the ppa before investing you would have noticed that the government has no obligation to renew the ppa after 2021. That's because when kapco was set up they had a 30 year agreement. Most ipps will have to handover their assets to WAPDA after the term of the agreement ends. Current shareholders will not get to participate in the ppa set by WAPDA then. An intelligent person wouldn't invest in ipps near expiry of 30 yr agreement.

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