Acwa Power increases its stake in Saudi Arabia power plant owner
The Riyadh-based operator becomes the second-largest shareholder in Hajr Electricity Production Company
Acwa Power acquired 4.99 per cent of Samsung C&T’s share in Hajr Electricity Production Company, increasing its stake in the company to 22.49 per cent as the Riyadh-based utility firm becomes its second-biggest shareholder.
HEPC is currently owned by state-owned Saudi Electricity Company with a 50 per cent stake, alongside a consortium of companies including Acwa Power, Mena Infrastructure Fund and contractor Samsung C&T. The company built and operates the Qurayyah Independent Power Plant in Saudi Arabia.
“The increase of equity participation in the Qurayyah IPP project is an indication of Acwa Power’s confidence in the Kingdom’s economy and social prosperity,” Paddy Padmanathan, chief executive of Acwa Power, said. The company is continuing to develop "environmentally responsible and [the] most efficient power generation and desalinated water production solutions at least cost", Mr Padmanathan added.
Following the deal, Samsung C&T's stake has reduced to 12.51 per cent, from 17.5 per cent previously. Mena Infrastructure Fund holds 15 per cent. The Qurayyah project was signed in 2011 and units commenced power delivery to the grid in 2013, with commercial operation beginning in the first quarter of 2015. The plant has a capacity of 3,972 megawatts and cost $2.7bn (Dh10bn) to build, of which 75 per cent was financed through debt and the remainder through equity.
Acwa Power, which is co-owned by nine Saudi conglomerates, including the Vision International Investment Company, the Public Investment Fund, Saudi Public Pensions Agency and the International Finance Corporation, operates in 12 countries in the Middle East, Africa and South-East Asia. It has a portfolio of 59 assets with a total investment of $48bn producing 34 gigawatts of power and 5.9 million cubic metres per day of desalinated water.
The company aims to operate in 40 countries by 2030, Mr Padmanathan said at an Abu Dhabi conference earlier this year. It is also considering an initial public offering to fund growth.
In April, Dubai Electricity and Water Authority signed a 25-year power purchase agreement with Acwa Power for the fifth phase of the Mohammed bin Rashid Al Maktoum solar park.
The 900MW phase will be commissioned in stages starting from the third quarter of 2021, according to the utility.
Updated: June 8, 2020 04:57 PM