Karachi April 7 2025: Liberty Power Holdings terminated the SPAs, citing an alleged material breach by Engro Energy under the EPQL SPA, which they claim also nullifies the EPTL and SECMC SPAs.
Earlier on April 4, 2024, Engro Energy Limited (EEL) has entered into the share purchase agreement with Liberty Power Holdings Limited, along with other parties acting in concert (the “Acquirers”) for the sale of its entire: (a) 68.9% shareholding in Engro Powergen Qadirpur Limited (EPQL), (b) 50.1% shareholding in Engro Powergen Thar (Private) Limited (EPTL), and (c) 11.9% shareholding in Sindh Engro Coal Mining Company Limited (SECMC).
This is to inform you that EEL has received a notice of termination dated April 2, 2025 from the Acquirers purporting to terminate the SPAs with effect from March 30, 2025 on account of an alleged material breach by EEL under the EPQL SPA and further alleging that the termination of the EPQL SPA renders completion of the EPTL SPA and SECMC SPA impossible thereby nullifying those agreements as well (“Buyer Termination Letter”). Further, and as you are already aware, the Acquirers have withdrawn their public announcement of intention on April 3, 2025 in relation to EPQL SPA.
In this regard, we would like to inform you that EEL has, through written communication to Acquirers, categorically denied and disputed all allegations of material breach by EEL under the EPQL SPA. The alleged material breach – that EPQL entered into Amendment Agreement with Government of Pakistan and CPPA-G in self-interest is baseless and unfounded. This agreement was executed in the larger national interest. The Acquirers had direct knowledge of negotiations as Liberty also signed a similar agreement with Government of Pakistan and CPPA-G along with other 2002 power policy IPPs. We have rejected the Acquirer’s wrongful and unjustified termination of the EPQL SPA and withdrawal of the public announcement of intention and assertions that the SECMC SPA and EPTL SPA are nullified as a result thereof.
Furthermore, pursuant to the terms of the SPAs, the Parties were required to satisfy certain joint conditions precedent prior to the expiry of the long stop date, i.e., April 4, 2025. As these approvals were not obtained by the long stop date, and without prejudice to EEL’s rights and remedies arising from the Acquirer’s wrongful termination, EEL has elected to terminate the SPAs with immediate effect from April 05, 2025 (the “Termination Date”). This termination is being exercised in accordance with EEL’s rights under the SPAs due to the non-fulfilment of the agreed conditions precedent by the stipulated long stop date of April 4, 2025.
