Sembcorp buys 5.95% stake to wholly-own Sembcorp Energy India Limited

Sembcorp Industries (Sembcorp), through its wholly-owned subsidiary Sembcorp Utilities, has entered into a non-binding term sheet with its local Indian partner, Gayatri Energy Ventures Pte Ltd (GEVPL), a wholly-owned subsidiary of Gayatri Projects Limited (GPL), to acquire the remaining 5.95% stake in Sembcorp Energy India Limited (SEIL). Following the completion of the proposed acquisition, Sembcorp will become the sole owner of SEIL.

The purchase price for the shares is approximately INR4,060 million (US$56.8 million) in cash and is based on discounted cash flows and relevant transaction multiples. The acquisition will be funded through a mix of internal funds and borrowings.

Sembcorp’s India energy arm, SEIL, is a leading independent power producer in the country focused on growing a clean energy portfolio. At present, SEIL has a well-balanced and diversified portfolio of thermal and renewable energy assets of more than 4,300 MW. Since the beginning of the year, SEIL has commissioned 357 MW for the Solar Energy Corporation of India (SECI) 2 and SECI 3 wind power projects in India, bringing the total commissioned capacity for SECI wind power projects to 607 MW out of 800 MW. This is the largest operational generating capacity among SECI wind auctions.

The proposed acquisition is expected to be completed by end of the year, subject to the satisfaction of certain conditions precedent, including shareholders’ approval of GPL.

Negotiations on the definitive agreements are currently ongoing and Sembcorp will make an appropriate announcement when there are material developments on this matter.

This acquisition is not expected to have a material impact on the earnings per share and net asset value per share of the Group for the financial year ending December 31, 2019.