YTL Power sells stake in ElectraNet for RM3.07bil

YTL Power group managing director Datuk Yeoh Seok Hong (pic) said the disposal allowed the company to realise gains from a mature investment, optimise the balance of assets in its business portfolio and increase the flexibility to deploy its cash reserves towards viable new ventures that complemented its existing businesses.

KUALA LUMPUR: YTL Power International Bhd has divested 33.5% of its stake in electricity transmission specialist ElectraNet Pty Ltd in Australia to Australian Utilities Pty Ltd as trustee of Australian Utilities Trust for A$1.02bil (RM3.07bil).

In a statement yesterday, YTL Power said it would realise a gain on disposal of RM2.21bil upon completion of the transaction.

“The divestment contributes a 16.8% boost to YTL Power’s proforma net assets per share, with the value increasing to approximately RM1.88 per share upon completion of the disposal compared to RM1.61 for the financial year ended June 30 2021, and would result in proforma earnings per share of 26.02 sen,” it added.

It is important to note that YTL Power’s investment in ElectraNet in 2000 was its first international foray, building on its origins as Malaysia’s first independent power producer (IPP) with its two power stations in Paka and Pasir Gudang.

ElectraNet operates the high voltage electricity transmission system throughout South Australia under a 200-year lease, one of the most extensive regional transmission systems in the country.

The company transmits power from regional generators and interstate sources over long distances to metropolitan and regional areas including large, directly-connected industrial customers.

Meanwhile, YTL Power group managing director Datuk Yeoh Seok Hong (pic) said the disposal allowed the company to realise gains from a mature investment, optimise the balance of assets in its business portfolio and increase the flexibility to deploy its cash reserves towards viable new ventures that complemented its existing businesses.

“These include, in particular, new investments in solar energy and other renewables, in line with our shift towards more sustainable energy solutions, moving forward.

“The timing for divestment proved optimal in light of the attractive valuation of regulated utility assets and strong investor interest.

“The sale consideration of A$1.026bil (RM3.07bil) represents a valuation of 1.6 times the regulated and contracted asset base of the company,” he noted.

Following its investments in Australia, YTL Power expanded its international utility portfolio by acquiring a water and sewerage operator Wessex Water Ltd in the United Kingdom about two decades ago.

In 2009, it also acquired YTL PowerSeraya Pte Ltd, which has a licensed generation capacity of 3,100 megawatts and merchant multi-utilities businesses in Singapore.

The group also owns a 60% stake in YTL Communications Sdn Bhd, the operator of the “Yes” network and the first telco to launch 5G services in Malaysia.