Temasek sells PowerSeraya to YTL Power for S$3.8b
By Rachel Kelly, Channel NewsAsia | Posted: 02 December 2008 2117 hrs

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SINGAPORE: Temasek Holdings has sold the Singapore generation company PowerSeraya to Malaysia's YTL Power for S$3.8 billion.

PowerSeraya is the third and last genco that Temasek had put up for sale. It had earlier sold Senoko Power and Tuas Power.

The timing of the transaction was a surprise.

Just a week ago, Temasek had said that it was suspending the tender process for PowerSeraya due to poor market conditions.

In a statement, Temasek said it had found YTL Power's proposal to be attractive.

Temasek said with the sale of PowerSeraya, it would have fulfilled its commitment to help develop a competitive power generation market in Singapore.

YTL will pay S$3.6 billion for the purchase and take on a debt of $201 million.

The transaction is expected to be completed in early 2009.

PowerSeraya is the second largest power generation company in Singapore by installed capacity.

It can produce 3,100 megawatts of electricity or about a quarter of Singapore's total licensed generation capacity.

PowerSeraya also operates oil trading and multi-utility businesses.

YTL Power Managing Director Francis Yeoh said the acquisition of PowerSeraya will help grow YTL's utility business in the region.

The deal is subject to approval from YTL shareholders.

DBS Bank is providing some S$2.25 billion in credit facilities to YTL. - CNA/vm