Powertek looking at expansion


  • Business
  • Tuesday, 21 Jan 2003

BY JAGDEV SINGH SIDHU

INDEPENDENT power producer Powertek Bhd is looking to expand its business in Malaysia and the Asean region, said executive director Dr Ong Peng Su. 

“As far as business development is concerned, we are always looking at opportunities,'' he said. 

Dr Ong Peng Hui

Speaking to the media after group subsidiary Panglima Power Sdn Bhd signed a RM1.22bil financing facility, Ong explained that given the growth in power demand, Powertek would give priority to acquisitions in the national power sector. But should the right project come its way, Powertek would venture overseas as well. 

He added that Tanjong plc's bid to privatise Powertek was expected to be completed in the 1st quarter of this year. 

On July 31 last year, Tanjong Energy Holdings, a subsidiary of Tanjong plc, had announced a voluntary general offer to acquire the remaining shares in Powertek not already owned by it for RM8.50 per share. 

The RM1.22bil financing facility signed yesterday would be used to part-finance the construction of the Panglima Power's 720MW power plant in Teluk Gong, Malacca, and to provide working capital. 

The Powertek group currently has a total operating capacity of 1,230MW. With the conversion of a 720MW combined-cycle plant, the group's total generating capacity would rise to 1,490MW. 

Approval for the Panglima Power expansion was obtained in March 2001 and the power purchase agreement (PPA) signed with Tenaga Nasional Bhd (TNB) in July last year. Under the PPA, Panglima Power will get 11.73 sen per kiloWatt-hour of electricity supplied to TNB. 

The construction of the Malacca power plant is being undertaken on a fast-track basis, and the conversion of the combined cycle generating facility is targeted for completion in March this year. 

The 720MW plant utilises the latest, more efficient F-class gas turbine technology and Panglima Power is the first to use such turbines in Malaysia.  

The financing facility consists of RM830mil bonds, RM306mil commercial paper/medium-term notes and a RM84mil standby revolving credit facility. 

Panglima Power will raise RM500mil from the first tranche of the bond issue and RM330mil from the second tranche. The tenure of the bonds ranges from six-and-a-half years to 13 years. 

The commercial paper and notes have a maturity of between one and seven years. Rating Agency Malaysia Bhd has assigned a AA2 rating to the financing facility. 

AmMerchant Bank is adviser and lead arranger of the financing exercise, with UOB Malaysia, Aseambankers, Commerce In- ternational Merchant Bankers and EON Bank as co-arrangers. 

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