Death toll rises to eight following religious disturbances in Punjab province.
Police were deployed across the district and the situation was tense in the area following the killings.
Haideri led the Sipah-e-Sahaba Pakistan, a Sunni group blamed for a string of sectarian attacks across Pakistan against minority Shias.
The group was also implicated in recent attacks on Christians in the city of Gorja, in which at least eight people died.
Shah said he suspected a personal grudge as the motive in the killing and said that the attacker had been identified.
Shias account for about 20 per cent of Pakistan’s mostly Sunni Muslim population of 160 million.
More than 4,000 people have died in outbreaks of sectarian violence since the late 1980s.