See Hup Seng to co-invest in ISDN power projects in RI

By Romel S. Gurky

SGX-listed integrated engineering solutions provider ISDN Holdings Limited said Tuesday it has reached an in-principle agreement with SGX-listed See Hup Seng Limited for the latter to co-invest in the development of a portfolio of mini-hydropower projects that ISDN, through its wholly-owned subsidiary Aenergy Holdings Company Ltd is currently spearheading.

See Hup Seng will play a proactive participative role in the development of the 52.6 megawatt (MW) worth of mini-hydropower projects that ISDN has amassed to-date in Indonesia, ISDN said in a statement.

The total estimated equity required by ISDN for this portfolio of projects is US$32 million with the total project cost amounting to $105 million, it added.

?The proposed investment will see See Hup Seng investing in $8 million through the subscription of Aenergy ordinary shares representing 25 percent shareholding in Aenergy. See Hup Seng will be awarded one out of a maximum of five Board seats subject to a minimum shareholding of 20 percent,? the statement explained.

Aenergy?s portfolio of proposed mini-hydropower projects include:

North Sumatera
? PT Charma Paluta (?Sisira?): 4.6 MW;
? PT Prima Paluta (?Parduaan?): 10 MW;
? PT Alabama Energy (?Anggoci? 1 & 2) : 20 MW;

South Sulawesi
? PT Punggawa Datara (?Datara?) : 10 MW;
? PT Tomini Energi (?Tomini Palasa?) : 8 MW.

Aenergy will hold 80 percent ownership of each of the above project companies, while the remaining 20 percent will be owned by Indonesian partners except for the Datara project in which Aenergy holds 75 percent shareholding.

ISDN President and Managing Director Teo Cher Koon said, ?Our long-term strategic plan is to grow this portfolio to 100 MW with a view to eventually securitizing it via a public listing or partial sale when the portfolio matures.?

?This is in addition to our recently announced plans to jointly develop additional minihydroelectric power plants in Indonesia with PT Jodo Alam Titra with a combined target of 100 MW capacity, with each project size to be at least 5 MW over the next few years,? Teo added.

The requisite due diligence will be undertaken by both ISDN and See Hup Seng before eventually entering into definitive agreements, the statement said.

Elsewhere, ISDN said that it has entered into an investment agreement on July 23 with Canadian private investor Robert Alexander Stone, following which the latter will subscribe to ordinary shares in the share capital of Aenergy.

Stone will invest up to US$6.4 million (or approximately S$7.9 million based on the exchange rate of S$1.24:US$1.00) to acquire a 20 percent equity stake in Aenergy; ISDN will retain 80 percent ownership of Aenergy. Stone has for a start made an initial payment of US$2 million to Aenergy.

Stone is a long-term investor in publicly listed companies in Asia Pacific - including ASEAN, Hong Kong and New Zealand - focused on the healthcare and clean energy sectors.

Editing by Reiner Simanjuntak