Union Bank of Switzerland (UBS) has been appointed financial adviser on the privatisation of Karachi Electric Supply Corporation (KESC). The Privatisation Commission, in conjunction with the World Bank, had shortlisted 10 companies in early December last year (MEED 19:12:97).

The client is currently inviting expressions of interest from international power operators interested in assuming the management control and equity in KESC which has about 1,700 MW of generating capacity. Sources say the corporation has accumulated liabilities of about $500 million due to mismanagement, theft of power and equipment. The equity stake for sale has not yet been decided.

The UK's NatWest Markets was originally appointed financial adviser by the government of former prime minister Benazir Bhutto. Sources say that the government wants to press ahead with the privatisation plans through competitive bidding despite speculation that negotiations are being held with South Korea's Daewoo Corporation concerning the sale of a 50 per cent stake.

Daewoo is understood to have proposed the establishment of a joint venture company with a 30-year concession for generation, transmission and distribution in the Karachi area.