Sembcorp Industries sells its Sembcorp Energy India unit to Tanweer Infrastructure Pte. The sale price is 117.34 billion rupees, or $1.47 billion.
A sale in support of an energy transition for Sembcorp
This transaction is part of Sembcorp’s commitment to move towards cleaner energy production. In fact, the company is one of the largest producers of electricity in India. It does this by operating two coal-fired power plants with a total capacity of 2.64 GW. This will enable it to serve nearly 2.5 million households.
In addition, Eugene Cheng, CFO of Sembcorp comments on the current coal market. Thus, he says that a situation where there is a lack of liquidity to fund assets remains. As a result, Tanweer Infrastructure will finance the purchase of the company through a deferred payment provided by SCU.
Singapore’s Sembcorp Industries does not want to withdraw from the Indian market. In this sense, it states that this sale does not mean a withdrawal from the country. It adds that it has ambitions to invest more in the market and especially in other areas than coal.
Acquisition of Vector Green Energy?
According to the Indian newspaper Mint, Sembcorp is reportedly making a bid for clean energy platform Vector Green Energy. The latter is a producer of green energy being specialized in renewable energies. The company is in favor of India’s energy transition and wants to contribute to it.
The acquisition of Vector would seem to be a move that suits the Singaporean company’s wishes. However, Wong Kim Yin, president of Sembcorp, declined to comment on the potential acquisition. Nevertheless, he says the group is constantly looking for new assets.
The sale of Sembcorp Energy India is still subject to approval by Sembcorp’s shareholders. Validation by the shareholders is expected in November. Following this, the sale can be finalized within six months if the necessary authorizations are obtained.
