Sembcorp to Increase its Stake in India Renewable Energy Business to 100%

Singapore, Aug 31, 2017

Sembcorp Industries (Sembcorp) wishes to announce that its wholly-owned subsidiary Sembcorp Utilities has entered into an agreement to acquire IDFC Private Equity Fund III (IDFC)’s remaining stake in Sembcorp Green Infra (SGI), for INR 1410.2 Crores (approximately S$301 million). With this, Sembcorp will become the sole owner of SGI. 

Pursuant to the prevailing shareholders’ agreement between the parties, Sembcorp Utilities has exercised its contractual right to acquire IDFC’s remaining shares in SGI. The consideration for the acquisition was agreed between the parties based on, amongst others, comparable market valuations, and an assessment of SGI’s assets and business prospects. 

SGI is one of the largest renewable energy players in India. It has established itself as a reliable renewable energy provider and is present across seven states in India. It was awarded 250 megawatts in India’s first national wind power tender earlier this year, reflecting the strength of its capabilities.  

Said Neil McGregor, Group President & CEO of Sembcorp Industries, “Buying IDFC’s stake in SGI reaffirms Sembcorp’s commitment to a long-term presence in India. The deal will allow us to drive SGI’s growth as the 100% owner, and increase our investment in a wind and solar generation portfolio that strongly complements our thermal power assets in the country. Strengthening our investment in renewables will also help us stay abreast of advances in greener power generation, and will enable us to deliver electricity to our customers in an increasingly sustainable manner.”

Vipul Tuli, CEO & Country Head of Sembcorp India, added, “With the far reaching energy reforms and electrification underway in India, there is a demand for both renewable and thermal power in the country. Sembcorp’s acquisition of IDFC’s stake in SGI strengthens our position as a reliable provider of clean and low cost power to support India’s growing energy needs.” 

SGI hasclose to 1,200 megawatts of wind and solar power capacity in operation and under development. As at end-2016, the net asset value and net tangible asset value at SGI level were S$427.6 million and S$426.9 million respectively. The net profit at SGI level for the 12-month financial period ended December 31, 2016 was approximately S$39.0 million. 

This acquisition will be funded through a mix of internal funds and borrowings, and payment will be settled in Indian rupees. Completion of the deal is expected to take place in the first quarter of 2018. 

Save for their respective shareholdings in Sembcorp, no director or controlling shareholder of Sembcorp Industries had any interest in this transaction. 

Financial impact
The effect of the acquisition on Sembcorp’s net tangible assets per share and the earnings per share is immaterial, assuming that the transaction had been effected as at December 31, 2016 and January 1, 2016 respectively.

Relative figures with respect to Listing Manual Rule 1006 
The relative figures for the acquisition pursuant to Rule 1006 of the Singapore Exchange Securities Trading Limited’s Listing Manual (“Listing Manual”), with reference to Sembcorp’s latest announced consolidated financial statement for the six months ended June 30, 2017, are as follows:

 

(1)Under Rule 1002(3)(b) of the Listing Manual, net profit means profit before income tax, minority interests and extraordinary items.  

As the relative figure under Rule 1006(c) exceeds 5% but does not exceed 20%, the proposed acquisition constitutes a “Discloseable Transaction” as defined in Chapter 10 of the Listing Manual. As none of the relative figures exceed 20%, shareholders’ approval is not required.

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For media and analysts’ queries, please contact:

Media
Sourav Das (Mr)
Vice President
Corporate Relations
Sembcorp India
DID: +91 9910377455
Email: sourav.das@sembcorp.com

Fock Siu Ling (Ms) 
Assistant Vice President 
Group Corporate Relations
DID: +65 6723 3011
Email: fock.siuling@sembcorp.com

Analysts
Aleve Co (Ms)
Senior Manager
Group Corporate Relations
DID: +65 6723 3178
Email: aleve.co@sembcorp.com

ABOUT SEMBCORP INDUSTRIES
Sembcorp Industries is a leading energy, water and marine group operating across five continents worldwide. With facilities of about 11,000 megawatts of gross power capacity and close to nine million cubic metres of water per day in operation and under development, Sembcorp is a trusted provider of essential energy and water solutions to both industrial and municipal customers. It is also a world leader in marine and offshore engineering as well as an established brand name in urban development. 

The Group has total assets of over S$23 billion and employs 8,000 employees. Listed on the main board of the Singapore Exchange, it is a component stock of the Straits Times Index and several MSCI and FTSE indices. 

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