Degree

Master of Science in Management

Faculty / School

School of Business Studies (SBS)

Department

Department of Management

Date of Submission

Spring 2023

Supervisor

Dr. Ashar Saleem, Assistant Professor and Program Director MS Management, Department of Management, Institute of Business Administration (IBA), Karachi

Committee Member 1

Dr. Ashar Saleem, Supervisor Assistant Professor and Program Director MS Management, Department of Management, Institute of Business Administration (IBA), Karachi

Committee Member 2

Dr. Muhammad Ayaz, Assistant Professor, Department of Management

Committee Member 3

Dr. Amer Iqbal Awan, Assistant Professor, Department of Management

Project Type

MS Management Research Project

Access Type

Restricted Access

Abstract

The privatization of public utilities has been a topic of debate and controversy for years. In this study, I am examining the impact of privatization on K-Electric, Pakistan’s largest and only vertically integrated power utility, during the tenure of Abraaj Capital, a private equity firm that acquired a controlling stake in the company in 2008-09. Drawing on financial and operational data, a time series analysis was conducted to investigate the relationship between privatization and revenue, while controlling other relevant factors. Time series analysis was conducted using a multiple linear regression model. The results provided valuable insight into the relationship between revenue and privatization first and then for-profit and privatization for K-Electric helping to answer the research question on the impact of privatization on the company’s performance. These findings challenge the conventional wisdom that privatization necessarily leads to better performance and raise questions about the effectiveness of privatization as a policy tool for achieving objectives successfully. Analysis suggests that policymakers and regulators should carefully consider the potential benefits and drawbacks of privatization, and weigh these against other options for improving service delivery and financial performance. Greater transparency and accountability in the privatization process may help to mitigate some of the risks associated with privatization while ensuring that the benefits are shared equitably among all stakeholders. This study can contribute to the literature on privatization by providing a detailed case study of K-Electric under Abraaj's leadership and highlighting the importance of considering the impact of privatization. These insights have implications for policymakers, regulators, and investors who are considering or implementing the privatization of critical infrastructure assets.

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