Singapore Temasek’s on track with genco sales
By RONNIE LIM
THE first was sold to the Chinese, and the second has just gone to a Japanese/French group. Temasek Holdings’ divestment of the three biggest generating companies (gencos) here, aimed at injecting greater competition in the power market, is well on track.
Temasek announced yesterday that Senoko Power, Singapore’s largest power station with 3,300 megawatts, has been sold for about $4 billion to the Lion Power consortium that includes French power and water utility giant GDF Suez and comprises four Japanese companies, led by Marubeni Corp.
The ‘enterprise value’ of about $4 billion comprises a cash consideration of $3.65 billion plus $323 million of net debt of Senoko Power as at March 31, 2008, which Lion will assume, it added.
The five-member Lion Power consortium comprises Marubeni, GDF Suez (with reportedly a 30 per cent stake), Kansai Electric Power Company, Kyushu Electric and Japan Bank for International Cooperation.
The price which Senoko fetched is slightly lower than the $4.235 billion paid in March by China Huaneng Group for the 2,670 MW Tuas Power - the newest, but smallest of the three gencos. On a straight per megawatt basis, the latest Senoko sale works out to be about 30 per cent cheaper than Tuas’s.
Still, with two gencos sold in just 11 months Temasek is well within its target of mid-2009 to complete the entire divestment exercise. Only PowerSeraya, the second largest power station here with 3,100 MW capacity, remains.
Gwendel Tung, Temasek’s director of investment, said that ‘Lion Power’s proposal was the most attractive in terms of price and commercial terms among a field of highly reputable investors’. She added: ‘With the accelerated timeline and expeditious completion of this transaction, we are well-positioned to conclude our genco divestment plan on schedule.’
Chihiro Shikama, Marubeni Corp’s executive officer, said: ‘This sizeable investment is a significant vote of confidence in the Singapore economy and energy sector.’
Lion strongly supports Senoko Power’s environmental leadership and has committed significant additional investment to construct new, more-efficient gas-fired units, he added.
Senoko Power supplies about 30 per cent of total electricity needs here. For the year ended March 2008, the company reported revenue of $2.495 billion and Ebitda (earnings before interest, tax, depreciation and amortisation) of $245 million.
Source : Business Times - 06 Sept 2008
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