SIAMGAS and Petrochemicals (SGP), a supplier of liquefied petroleum gas, will take over a 230-megawatt power plant in Myanmar for US$48 million (Bt1.69 billion) in cash as part of its drive into other energy businesses.
The combined-cycle power plant in Myanmar should give SGP higher income and return on investment, which should add value to the company, it said in a report to the Stock Exchange of Thailand.
According to its filing yesterday to the SET, the acquisition will be made via Siam Gas Power (SPW), its wholly owned subsidiary in Singapore.
The Myanmar power plant is operated by MSN International, Asiatech Energy and Myanmar Lighting (IPP) Co, so the transaction will be divided into two steps.
SPW will purchase 30 per cent of MSN and Asiatech for $24 million. This step is expected to close this month.
Then SPW will purchase 30 per cent of Myanmar Lighting (IPP) for $24 million.
SGP will pay the remaining amount to the seller when SPW is granted permission from authorities in Myanmar to hold shares in Myanmar Lighting (IPP) directly. The transaction is expected to close by November.
The deal will be financed by working capital and loans from financial institutions.
SGP’s board of directors approved the transaction, given the opinion that the investment in the power-plant business will give the company a stable income and diversify its revenue sources.