Tata Power loses Senoko bid; Marubeni to buy it for $2.5 billion

05 September 2008

Mumbai: Tata Power has lost the bid for acquiring the stake of Singapore's state-owned investment company Temasek Holdings in the 3300 MW Senoko Power Limited, Singapore's largest power generating company.

Temasek had shortlisted Tata Power among five other companies, including Japan's Marubeni Corporation, Malaysia's YTL Power Bhd, France-based GDF Suez and a tie-up between Hong Kong's CLP Holdings and Japan's Mitsubishi Corp - OneEnergy Ltd, to bid for the project.

The Marubeni-led group, which included GDF Suez SA, Kansai Electric Power Co. and Kyushu Electric Power Co, agreed to pay $2.5 billion (Singapore $3.65 billion) in cash for Senoko Power Ltd, to expand into Southeast Asia's power and gas markets.

The Marubeni group bid values the Singapore electricity utility to S$1.1 million per megawatt of generating capacity.

The Marubeni consortium will gain a 30 per cent share in Singapore's electricity market as the government sells its generators to further open the industry to competition after the disposal of Tuas Power Ltd earlier this year.

Senoko Power is the second of the three power generating companies that Temasek had planned to divest. After the successful sale of Tuas Power to SinoSing Power Pte Ltd earlier in March, Temasek announced the divestment process of  Senoko Power in July 2008. It also said that it would sell its third power generation company PowerSeraya after the sale of Senoko.