What's the Point of This Move?
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Having read this, I feel like I've just watched my neighbor put out her laundry to dry...
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Temasek to sell its power generation companies from September
By Wong Siew Ying, Channel NewsAsia | Posted: 19 June 2007 1823 hrs
SINGAPORE: Investment company Temasek Holdings plans to sell three of its wholly-owned Singapore power generation companies (gencos), starting from September.
These three gencos, PowerSeraya, Senoko Power and Tuas Power, will be divested over the next 12 to 18 months.
The deals are expected to be completed by the end of next year or early 2009.
Together, the three gencos account for 80 percent of Singapore's power generating capacity, producing about 3,000 megawatts of electricity each.
Temasek Holdings said it has received good interest for the three gencos over the past year and would be selling the companies one by one.
The first is likely to be offered through a tender process and Temasek will assess the bids based on commercial merit.
It has hired banking advisors Morgan Stanley and Credit Suisse to facilitate the sales process.
Wong Kim Yin, Managing Director, Investments, Temasek Holdings, said: "In terms of the first genco, we are more inclined towards a trade sale. We think that will better meet our objectives than an IPO (initial public offering). At the moment, we are not inclined to retain any residual stake in any of the gencos, so a trade sale would meet that objective better."
But Temasek is not ruling out other options, such as selling shares through an IPO for the other two gencos.
Temasek has declined to give a dollar value for the gencos, but reports have estimated that each company could fetch between S$2 billion and S$3 billion.
The long-awaited sale is in line with the government's aim to liberalise the electricity market in Singapore.
To increase competition, there will be no restrictions on foreign ownership of the gencos.
Temasek said this change in ownership is unlikely to have an impact on electricity prices.
Mr Wong said: "Changing ownership by itself is not expected to have any impact on consumers because they will continue to be served by SP services, which will continue to buy from the wholesale market and enjoy the benefit of competition among these gencos."
Temasek said it is an optimal time to sell because of favourable market conditions and the huge demand for electricity.
Moreover, there is also a gas regulation framework in place to ensure there is a steady and orderly supply of gas and power. -
if you privatize it .... and get some GLCs to team up with some token foreign partner to buy and run them .....
any utility price hikes won't leave any turd mark on yourself then, no ? ....
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OMG?!! What if foreign companies successfully bidded for them? More rises coming soon
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Precisely, that's why I say it's much like watching my neighbor put out laundry to dry...Originally posted by Fatum:if you privatize it .... and get some GLCs to team up with some token foreign partner to buy and run them .....
any utility price hikes won't leave any turd mark on yourself then, no ? ....
They always doing things to serve their own interests and wash their hands - just like HDB loans handed to banks....
I really feel PAP ought to be kicked out in due course... -
Now the economy is booming, they sell can get more money.
Don''t forget they lose a lot of money in bad investments like Shin Corp. so need to top up! -
Mr Wong said: "Changing ownership by itself is not expected to have any impact on consumers because they will continue to be served by SP services, which will continue to buy from the wholesale market and enjoy the benefit of competition among these gencos."
They think foreign companies so stupid is it? If there is no money to be made, who will want to buy your gencos? What will most likely happen is that the 3 gencos, assuming they are even bought by differently parties, will form a cartel and raise prices. -
This is what I feel will happen...Originally posted by Panache1976:They think foreign companies so stupid is it? If there is no money to be made, who will want to buy your gencos? What will most likely happen is that the 3 gencos, assuming they are even bought by differently parties, will form a cartel and raise prices.
This way, their hands are "clean" when prices goes up and up...
Very predictable of our gov... -
Our 3 power plants are just very stable income generators for any investors.
I doubt there will be hikes. But I doubt there will be true competition (well, all the powers go thru the same wire and we pay to Singapore Power (Power Administrator), not individual company. So there will not be power bills cuts also. -
While they're at it, they should go ahead and sell their arses too...!Originally posted by Eiizumi:Our 3 power plants are just very stable income generators for any investors.
I doubt there will be hikes. But I doubt there will be true competition (well, all the powers go thru the same wire and we pay to Singapore Power (Power Administrator), not individual company. So there will not be power bills cuts also.