Sembcorp Industries’ wholly-owned subsidiary, Sembcorp Solar Vietnam, has agreed to acquire majority interests in various subsidiaries of Gelex Group. The majority interests range from 73% to 100%. Sembcorp is expected to pay a maximum equity consideration of around $218 million. The amount will be funded through a mix of internal cash resources and external borrowings and payable upon the completion of the transaction.
Through the proposed transaction, Sembcorp will add 245MW of operational renewable wind, solar and hydropower assets to its current assets in Vietnam. The group will also expand its renewables presence in the country to over 450MW.
Upon the completion of the proposed transaction, which is expected to take place in 1H2024, Sembcorp’s gross renewables capacity will total 12.2GW.
According to Sembcorp, the assets that the group will acquire are underpinned by long-term power purchase agreements contracted with Vietnam Electricity, a state-owned enterprise. Following this, Sembcorp and Gelex will continue to explore opportunities in renewable energy in Vietnam.
The proposed transaction will not have a material impact on Sembcorp’s earnings per share (EPS) and net tangible assets (NTA) per share for the FY2023 ending Dec 31.
Shares in Sembcorp closed 7 cents lower or 1.37% down at $5.05 on Nov 10.
