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Sembcorp buys 45.3% stake in China’s Xingling New Energy worth $154mn

Date: November 19, 2022 Meghna Singh Meghna Singh
Sembcorp buys 45.3% stake in China’s Xingling New Energy worth $154mn 
Singaporean energy solutions provider Sembcorp Industries Ltd has reportedly purchased a 45.3% stake in Chinese renewable energy giant Hunan Xingling New Energy for ¥1.1 billion (US$154 million), entering a partnership with the largest global renewables firm.



Sembcorp announced this week that its subsidiary Sembcorp Energy (Shanghai) will acquire the stake from Wuling Power, which is an affiliate of the state-owned State Power Investment Corporation (SPIC).



The deal will see Xingling New Energy become a joint venture between Wuling Power and Sembcorp, with the former holding the remaining 54.7% stake.



Wong Kim Yin, President and CEO of Sembcorp Group, said that SPIC was the largest global player in renewables, having an installed capacity of more than 80 gigawatts (GW), and that Sembcorp was privileged to partner with them.



He added that the firm looked forward to developing this deal to expand its partnership with SPIC in the green energy and renewables domain.



Alex Tan, CEO, Sembcorp China, explained that the deal would be the first renewable energy JV SPIC had with a foreign strategic investor, and would enable Sembcorp to increase its presence in Hunan, which is a new market for the company.



Tan commented that the province was a major energy demand center in China and looked forward to working with Wuling Power and supporting the country’s renewable energy needs.



Under the deal, Xingling New Energy will own various wind and solar assets in Hunan and Guizhou, which will consist of 830MW of installed renewable capacity, with 62MW still under development.



With the acquisition, Sembcorp’s gross renewables capacity will reach 9.4GW globally, inching closer to its target of 10GW by 2025.



The Sembcorp affiliate said that the transaction is expected to conclude in the first half of next year, which is funded through a combination of external borrowings and internal cash resources. It added that post-completion, the acquisition is anticipated to be accretive to earnings.



After the announcement, Sembcorp’s share rose 1% to $3.08 on Friday morning.



Source credit: https://www.straitstimes.com/business/sembcorp-partners-world-s-largest-renewable-energy-company-with-204m-acquisition

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Meghna Singh

An English Literature graduate, Meghna Singh ventured into the profession of content development to incorporate her knack for writing articles across verticals including technology, healthcare, business, and alike for News Origins and Newsorigins. She has also completed her MBA in Tourism and worked as a content creator in the field of product development.