Written by: ENS Economic Bureau
2 min readMumbaiMar 5, 2013 01:33 AM IST
First published on: Mar 5, 2013 at 01:33 AM IST
The GMR Group has decided to divest its 70 per cent stake in GMR Energy Singapore Pte GMRE to FPM Power for S 660 million Rs 2,907 crore.
The group will net a profit of Rs 1,356 crore from the sale,which it will use in its domestic energy business where it is currently developing power projects totaling 5,790 megawatts,GMR said in a statement on Monday. GMR Group has entered into a share purchase agreement on March 4 to sell its 70 per cent interest in GMRE to FPM Power Holdings Ltd for a total equity value of S660 million, the company said in a statement.
The company said that the agreement was in line with its Asset Light,Asset Right strategy under which it followed the principle of develop,build,create,value and divest. Of the S660 million,FPM Power will invest S 60 million in GMRE as balance equity.
The transaction is subject to approval from project finance lenders to GMRE,it said,adding,the sale translates to an enterprise value 100 per cent basis for GMRE of S1,612 million on project completion by end 2013.
GMR Group Chairman G M Rao said: GMRE is a solid testimony of GMRs ability to identify a good opportunity,develop and execute a world class power project of high efficiency in a developed country like Singapore. The project is completely on schedule and within budget.
GMRE is a company established for construction,operation and maintenance of a 2X400 natural gas fuelled power plant on Jurong Island,Singapore.
The GMRE power plant,the company said,is nearly 96 per cent complete and expected to commence operations by the end of 2013. GMR Infrastructure Singapore owns 66.4 per cent of GMRE and 3.6 per cent is held by GMR Infrastructure. The balance 30 per cent stake in GMRE is held by Petronas.
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