Private equity: inside the fall of Abraaj | Financial Times

Private equity: inside the fall of Abraaj | Financial Times:

It was a deal that should have provided Abraaj Group with one of its biggest ever paydays. Instead the failure to sell a majority stake in Pakistan’s K-Electric to a Chinese group has all but crippled the Dubai-based private equity group.

Had the $1.8bn sale gone through at the end of 2017, its parent, Abraaj Holdings, would have received almost $450m. It didn’t. And within six months, the holding company had filed for provisional liquidation — a Cayman Islands court-driven restructuring process — to protect itself against a winding up order brought by two creditors. It had debts of over $1.1bn, and faced allegations of misusing investor money held in Abraaj’s $1bn healthcare fund to support the business of founder Arif Naqvi.

Abraaj claims that it had followed procedures, but the loss of confidence sent the firm into a death spiral.