China's Shanghai Electric Power firm will buy a $1.77 billion controlling stake in K-electric, Pakistan's largest and only vertically integrated power utility, the Abraaj Group announced on Sunday.

Dubai-based Abraaj Group is selling its 66.4 percent stake in K-Electric via its KES Power unit, Bloomberg reported citing a statement posted on the company's website. The deal will give Shanghai Electric Power access to 2.5 million customers in Karachi, the most populous city in south Asia.

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"Today marks a milestone in that partnership as we enter into a definitive agreement to divest our stake in high performance business and market leader to a strategic buyer who is fully committed to continuing this success story in the future," Arif Naqvi, Abraaj Group's CEO, said in a statement.

Upon completion, the agreement will be the largest acquisition in Pakistan over the last 10 years, Reuters reported.

"The K-Electric transaction only marks the beginning of SEP's cooperation with Abraaj and we look forward to further collaboration between the two parties in many other areas in the future," Wang Yundan, Shanghai Power's CEO, said.

Shanghai Electric Power reportedly outbid other Chinese K-Electric suitors including clean energy group Golden Concord Holdings Ltd., French utility Engie SA, and at least one investment fund, according to Bloomberg citing sources familiar with the matter.

The deal will close after customary closing conditions and requisite regulatory approvals are completed, The Express Tribune noted.

K-Electric is formerly known as Karachi Electric Supply Company. It is a public listed power utility involved in generation, transmission, and distribution. It was taken over by Abraaj Group in 2009 through its Funds. 

TagsShanghai Electric Power, K-Electric, Abraaj Group, KES Power unit, power, Electricity, utility, Pakistan, china