By BERNAMA / Pic By Ytl.com
YTL Power International Bhd’s wholly owned subsidiary, YTL PowerSeraya Pte Ltd, has proposed to acquire the power plant and associated assets of Tuaspring Pte Ltd for S$331.45 million (RM1 billion).
The acquisition would be settled with S$230 million in cash and S$101.45 million comprising ordinary shares and loan notes amounting to 7.54% of the post-acquisition equity in YTL Utilities (S) Pte Ltd, the immediate holding company of YTL PowerSeraya.
The cash consideration will be funded by a bank loan, YTL Power said in a Bursa Malaysia filing yesterday.
The assets comprise a land lease over a site located at 90 Tuas South Avenue 3, Singapore, with a remaining term of 20 years and a 396MW combined cycle power station, as well as stocks and associated assets.
The assets are being sold via a receiver and manager process managed by Baker Tilly following an enforcement event under Tuaspring’s banking facilities provided by the Singapore branch of Malayan Banking Bhd.
According to YTL Power, the acquisition presents an opportunity to acquire an efficient, operating asset with a proven operational track record, as well as to enable the group to integrate the assets into YTL PowerSeraya’s existing businesses and consolidate its power generation capacity in Singapore.
It said the purchase is in line with the group’s strategy of investing in long-term geographically diverse infrastructure assets, while concurrently achieving synergies across its portfolio of utility businesses.
“The proposed acquisition would also enable the YTL Power Group to further diversify the sources and nature of its income-generating activities in Singapore.
“Based on the above and barring any unforeseen circumstances, the board believes that the proposed acquisition will contribute positively to the future earnings and shareholders’ value of the YTL Power Group in the long term,” it added.
According to the group, the combined cycle power plant was commissioned in 2016, after being originally constructed as part of a water desalination project following a tender held by the Public Utilities Board of Singapore.
Following defaults by Tuaspring, the water purchase agreement was terminated by PUB in 2019.
“Barring any unforeseen circumstances, the proposed acquisition is expected to be completed by the end of the second quarter of the 2020 calendar year,” the group added.
YTL Power currently operates in Malaysia, Singapore, the UK, Indonesia and Australia. It also has stakes in projects under development in Jordan and Indonesia. — Bernama