ADB lent Karachi's newly privatized KESC $150M for a turnaround; losses halved to 15%

Karachi's power utility KESC had been nationalized in the 1950s and by the 2000s was a chronic loss-maker: theft, unmetered connections and blackouts, with the state covering the deficits. Selling it was the first step, but a change of owner alone would not fix the operations.

In December 2005 the government privatized KESC, selling a majority stake while retaining a minority. In May 2007 the Asian Development Bank approved a $150 million direct loan to KESC to implement its post-privatization turnaround plan — money tied to an explicit rehabilitation program rather than to the government's budget.

The new owners installed a new executive team and replaced the operations and maintenance contract, then pushed metering and anti-theft enforcement while investing about $4.1 billion across the value chain. Consumers grew from 1.8 million in 2006 to 3.4 million, and units sold rose from 8.4 billion to 16.7 billion.

Distribution losses fell from 34.2% at privatization to 15.3% within fifteen years; the company that was losing $136 million when Abraaj bought control in 2009 posted a 17.3% net margin in 2015–16 and has taken no operational subsidy since privatization.