Tenaga Nasional Bhd (TNB) wants to complete the sale of minor stakes in two power plants by the end of August, a company official told Reuters yesterday.
The sale could fetch TNB about RM900mil, based on replacement value or the cost of building the two plants, analysts said.
Ideally, we would like to do it before the end of our financial year, the official said, adding that talks were ongoing.
The sale of these stakes and other disposals yet to be completed will help TNB reduce its large debt, which has crept 3% higher to RM31.4bil in the 1st half of its financial year, which ends on Aug 31.
The company plans to dispose of its 20% stake in the 440 megawatt (MW) Port Dickson plant and one fifth of the 1,300 MW plant in Perak.
Buyers are likely to be the plant's controlling shareholders.
Conglomerate Sime Darby Bhd holds a 60% stake in the Port Dickson power plant while Malakoff Bhd owns 75% of Segari Energy Ventures Sdn Bhd, operator of the plant in Perak.
But while TNB wants to sell its stake in Segari Energy, it may buy a 20% interest in Malakoff's new 650 MW plant in Perak with a view of selling it in the future, according to the company official.
The rationale is a profit motive. TNB believes that a sale of the mature Segari Energy would be more valuable at the current time, whereas (the new plant's) value will not be fully realised until it is fully operational, JP Morgan said in a recent report.
Last year, Tenaga agreed to sell a 20% interest in the Genting Sanyen power plant to gaming and power group Genting Bhd for RM240mil. Genting then bought from TNB a 40% stake in Sepang Power Sdn Bhd, a firm with a licence to build a power station, for RM66mil.
TNB is also due to finalise by Oct 30 the sale of a 40% stake in Malaysia's largest coal-fired plant located in Kapar in Selangor to Malakoff for RM1.68bil.
The firm recently reported that first-half earnings fell by almost half to RM705.9mil from a year earlier due to foreign exchange losses on its Japanese debt. Reuters
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