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SINGAPORE: Singapore investment company Temasek Holdings has sold its Senoko Power generating company to Lion Power Holdings for S$3.65 billion.
Lion Power is a vehicle owned by a consortium led by Japan's Marubeni Corporation. Other members of the consortium are GDF Suez of France, The Kansai Electric Power Company, Kyushu Electric Power Company and Japan Bank for International Cooperation.
Lion Power will assume S$323 million of net debt of Senoko Power as at March 31. The transaction is expected to be completed by September 12.
The deal falls in line with Marubeni's plans to expand overseas and double its power capacity in two years. It has already bought power assets in the Philippines and is building plants in the Middle East and Indonesia.
The bidding process for Senoko began in July and is the second of Temasek's three power generation companies to be sold. The first, Tuas Power, was sold to China's Huaneng Group in March for S$4.2 billion.
With the latest deal, only Power Seraya remains within Temasek's stable. Temasek said last year that it intends to divest all of its wholly-owned power generation companies in Singapore by the end of next year.
Unlike power-hungry countries like China and India, the growth in demand for energy in Singapore is limited. But Senoko Power's sale still attracted a lot of interest.
Temasek said Lion Power's bid was the most attractive in terms of price and commercial terms.
Analysts said Temasek is taking advantage of a lack of privatisation deals in Asia's power industry, having held back divestment plans in recent years.
Still, Senoko Power was sold off about 25 per cent cheaper than Tuas Power on a per mega-watt basis.
Senoko is the largest power generation company in Singapore and provides over 30 per cent of the nation's electricity needs.
- CNA/ir
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