1991–1998: Initial years Hub Power Company (Hubco) was founded in 1991. The project was funded by $770 million in loan agreements and $325 million in equity from international investors. The major investors included
National Power with 20.4 percent shareholding,
Xenel with 14.5 percent, and
Entergy with a 10 percent holding. Hubco also raised $175 million through the issuance of
global depository receipts (GDRs) on the
Luxembourg Stock Exchange, which peaked at $13.25 upon introduction to the market on 5 October, with each GDR consisting of 25 shares. Local investors were allocated approximately 69 million shares valued at $30 million following an
initial public offering on the
Karachi Stock Exchange at PKR 13.60. Of the $770 million loan, Hubco secured a $686 million, 12-year credit facility organized by
Citibank and other major banks on 30 September 1994, which included a $36.9 million concessional loan from the
Commonwealth Development Corporation and $465 million from loans facilitated by the
World Bank-funded public-sector energy development fund, including $166 million in standby funds at an interest rate of 2 percent plus
Libor. The company also obtained a local currency loan of Rs 3,012 million ($98.4 million) on 2 October in Karachi, arranged by the
National Development Finance Corporation and involving several Pakistani banks. Initially, the revenue of the company was denominated in
United States dollars. In October 1998, the
Nawaz Sharif administration canceled parts of energy purchase agreement with Hubco due to
corruption and high energy tariff.
1998–2018: Lawsuits, renegotiation of contracts, and decline In 2000, Hubco and its investors, including Entergy and National Power, agreed to forgive $200 million of the $274 million
debt owed by the
Water and Power Development Authority to Hubco. Hubco also reduced its
tariffs and
operation and maintenance contracts in 2002, reducing
internal rate of return from 17 percent to 12 percent. These adjustments were made to manage the remaining $74 million required for loan repayments. The lawsuit sought approximately $8 billion in damages over the 30-year life of the independent power project. In 2013, Laraib Energy's New Bong
Hydropower Plant commenced commercial operation. In 2011, Xenel exited Pakistan and sold its stake of 140 million shares (12.3 per cent) at a price of Rs37 per share. A year later, National Power UK divested its 17.44 percent shareholding to
Dawood Hercules and
Allied Bank Limited at PKR 31 per share. In 2013, Hubco incorporated its oil-fired Narowal Power Plant as its wholly owned subsidiary. In 2017, Hubco delisted its GDR from the Luxembourg Stock Exchange due to low trading volumes. In 2018, Dawood Hercules divested its 15.7 percent shareholding to Mega Conglomerate at PKR 105.12 per share.
2018–present: Diversification and termination of contract In 2019, the China Power Hub Generation Company (CPHGC) commissioned a 1.32 GW coal-fired thermal power plant. The $2 billion facility is now fully operational and is owned by CPHGC, a
joint venture between Hubco and China Power International. In October 2024, Hubco prematurely terminated its energy purchase agreement for the
power station based in Hub with the
government of Pakistan amid concerns about coercion and threats of
corruption cases against IPP owners if they sought
international arbitration. == Group ==