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BUSINESS

KPower's subsidiary enters into HOA with PFSB to acquire One River Power for RM130 mln

26/04/2022 02:59 PM

KUALA LUMPUR, April 26 (Bernama) -- KPower Bhd’s wholly-owned subsidiary, KPower RE Sdn Bhd, has entered into a heads of agreement (HOA) with Pristine Falcon Sdn Bhd (PFSB) to acquire up to five million shares, representing the entire equity interest in One River Power Sdn Bhd, for RM130 million.

In a filing with Bursa Malaysia today, it said One River Power is principally involved in the development of three hydropower plants based in Sabah with a total combined power generation of 29.1 megawatts (MW).

Pursuant to the HOA, it said the parties involved would enter into a definitive agreement for the proposed acquisition within 45 days from the date of the HOA or such extended period as may be mutually agreed.

It said the purchase consideration once finalised and agreed upon, shall be satisfied by a combination of cash and issuance of new shares.

Furthermore, it said the RM20 million to be paid in cash as a refundable deposit upon the execution of the definitive agreement while the remaining shall be satisfied through the issuance of new shares in KPower at an issue price of RM0.49 per share.

On the rationale of the exercise, it said the proposed acquisition is envisaged to provide an opportunity for KPower to acquire a total of 29.1 MW hydropower plants, which are partly operational and in line with the company’s asset ownership business model for long term dividend sustainability.

“It will enable the company to expand its income streams and further strengthening its position in the sustainable energy and utilities sector.

“As such, the proposed acquisition is expected to provide KPower with a profitable recurring income stream, which is expected to improve the company’s profit and provide better earnings visibility over the long term, thus enhancing shareholders’ value of the company,” it added.

-- BERNAMA

 

 


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