JERA buys stake in Summit Power’s

Singapore -based holding co for $330m

Business Desk | Published: 00:00, Oct 08,2019

 
 

Japan’s JERA Co has acquired a 22 per cent stake in Singapore-based Summit Power International, the holding company of Bangladesh’s Summit Power Limited, for $330 million, the companies said on Monday.

Summit Power International is the holding company for all power assets of Bangladesh’s Summit Group, while JERA is a joint venture between Tokyo Electric Power and Chubu Electric Power Co, reports Reuters.

The investment has been finalised within four months of signing the memorandum of understanding (MoU) between JERA and Summit in Tokyo, in presence of prime minister Sheikh Hasina and other government high officials and Summit Group chairman Muhammed Aziz Khan, said a press release issued by Summit and JERA in Dhaka on Monday.

International Finance Corp (IFC), IFC Emerging Asia Fund, and United Arab Emirates-based EMA Power Investment, which were shareholders of Summit since 2016, will exit through this transaction, according to the statement. However, IFC will continue to be a large lender to Summit, it added.

As a shareholder of Summit, JERA will strive to increase the corporate value of Summit through the efficient construction and operation of its power generation facilities and contribute to the sustainable economic growth of Bangladesh, it said.

Summit’s founder chairman Muhammed Aziz Khan said, ‘Much needed technology and capital for Bangladesh’s fast growing power and energy market will be available from JERA with their vast knowledge and balance sheet. JERA by far could be our best partner. This partnership will support our investment programme of $3 billion by 2022 in Bangladesh.’

JERA Asia CEO Toshiro Kudama said, ‘We look forward to working together with Summit in supplying not only reliable electricity but also primary energy sources to the people of Bangladesh. Our mission is to provide comprehensive solutions with state-of-the-art technologies to meet the underlying challenges in the energy industry globally.’

JERA said in a separate statement that it has positioned Bangladesh as a priority country for investment due to an expected rapid rise in electricity demand along with steady economic growth in the South Asian country.

The company last month had agreed to buy 49 per cent stake in a new 750 megawatt (MW) gas-fired power station project in Bangladesh, which is under development by India’s Reliance Power, said the Reuters report.

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