India's largest power utility Tata Power has emerged as the only Indian company among the six firms shortlisted to bid for Singapore’s largest power utility, Senoko Power, which is likely to be sold at over $3 billion.
If successful, Tata Power would have access to a generation capacity of 3,300 Mw, the largest in Singapore, and cater to 30% of that country’s electricity needs. The other five companies shortlisted by Singapore government-owned Temasek Holdings, which owns Senoko, are Japan's Marubeni and Mitsubishi Corp, Malaysia's YTL Power, France's GDF Suez and One Energy- CLP Holdings, said sources.
A Tata Power spokesperson confirmed the development. The next stage, where shortlisted companies have to submit their bids, would be completed over the next two to three months.
Reliance Power and GMR Infrastructure, the two other leading Indian power sector players which were in race, pulled out of the bidding process in the last minute, said the two company sources on condition of anonymity. However, both the companies have indicated that they might bid for the 3,100 Mw PowerSeraya, the third power generation asset which would soon come up for sale in Singapore, the same sources said.
India's power companies such as Tata Power and Reliance Power are also looking at acquiring and managing power assets abroad. Recently, GMR had picked up 50 per cent stake in US-based power generation company Intergen for $1.1 billion, in the largest-ever overseas deal in the Indian power space.
Reliance Power and a joint venture between Australia’s Macquarie Group and GMR Infrastructure were among the suitors for Tuas Power, the first of the three power generation companies which Temasek put up for sale as part of Singapore’s privatization of power generation and distribution.
Tuas was bought by SinoSing Power Pte Ltd, a wholly-owned subsidiary of China's largest power producer Huaneng Group, for $3 billion, in March this year.
Senoko Power’s assets include 1,945 Mw of gas-fired combined cycle plants, 1,250 Mw of oil-fired steam turbine plants and 105 Mw of diesel-fired open cycle gas turbine plants. For the year ended 31 March 2008, the company had revenues of US$1.81 billion and EBITDA of $ 177 million. Senoko sells all of its electricity output into the national electricity market of Singapore, a competitive wholesale electricity market.
Sources said Temasek was likely to soon call for bids to sell off PowerSeraya, as part of privatising the sector before 2009. PowerSeraya, with annual revenues of about $2.6 billion in 2007, has many power generating assets located at Jurong island, Singapore's oil, gas and petrochemicals hub. It controls 28 per cent of Singapore's energy market and has also diversified into oil storage, desalinated and cooling water solutions, energy trading, fuel management and bunker fuel blending and tank leasing.
