Sembcorp Industries, a Singapore-based renewable energy company, has acquired a 98 per cent stake in a 658 MW portfolio of operational wind and solar assets from GCN Capital Partners Infrastructure Fund III and its affiliates for $517 million through its 100 per cent subsidiary Sembcorp Energy (Shanghai). The assets are contracted and qualified for fixed feed-in tariffs under China’s renewable energy programme, and are located in energy demand areas such as Hebei, Henan, and Shandong provinces. Sembcorp will fund the project using a combination of internal cash resources and external borrowings. The acquisition is expected to be completed in the first half of 2022.
Sembcorp has been operating in China for over 20 years. Its wind generating plants in Hebei and Inner Mongolia have a total capacity of 725 MW. Sembcorp has a global energy portfolio of more than 13 GW, including more than 3.5 GW of renewable energy capacity made up of solar, wind, and energy storage. In August 2021, DBS Bank provided a SGD 40 million loan to Sembcorp Industries to set up a 60 MWp floating solar PV system on Tengeh Reservoir in Tuas, Singapore.
In September 2020, GDS Holdings Limited, a leading developer and operator of high-performance data centers in China signed an MoU with Sembcorp Industries Limited to partner on renewable energy initiatives. Under the agreement, both the companies will collaborate to develop renewable energy solutions for GDS data centers wherever accessible in China.
REGlobal’s Views: This acquisition will help Sembcorp to hasten its advancement in the Chinese market. Acquisition of operational high quality assets are an easier way for large companies to expand their portfolios quickly.