Saudi Crown Prince-led PIF acquires 15.2% stake in ACWA Power

The acquisition offer by Saudi's Public Investment Fund was first made in early 2017, and the fund now owns 15.2% direct, plus 9.78% indirect stake in the utilities giant

After a process that began with an offer in early 2017, Saudi Arabia’s Public Investment Fund (PIF) has acquired a 15.2% stake in ACWA Power.

PIF, led by Saudi Arabia’s Crown Prince HRH Mohammad bin Salman Al-Saud, now owns 15.2% direct stake in the developer, owner, and operator of power generation and water desalination plans.

Additionally, through the 9.78% separate stake ownership by its wholly owned subsidiary, Sanabil Direct Investments Company, PIF’s total shareholding – direct and indirect – in ACWA Power amounts to 24.98%.

In a statement, ACWA said the investment, in the form of a capital increase, would support its growth strategy and investment plan.

The investment is part of the Public Investment Fund Program, which aims to “unlock new sectors and industries, to support […] innovative Saudi businesses, and to achieve long-term returns”.

HSBC acted as the sole financial advisor to PIF and JP Morgan acted as the sole financial advisor to ACWA Power on the transaction.

READ: Saudi's Public Investment Fund eyes stake in ACWA Power

Commenting on the investment, PIF said: “We see exciting growth potential for ACWA Power and are very pleased to support its development.

“ACWA Power is a strategic long-term investment for PIF which has a proven asset base and demonstrated track record of leading innovative projects domestically and internationally.”

Mohammad Abunayyan, chairman of ACWA Power, added: “I am delighted to welcome the PIF in its own capacity as a significant shareholder of ACWA Power culminating a process where the offer was received in early 2017.

“Their endorsement underlines the central role we play in the Saudi economy and our successful international expansion all geared towards achieving the objectives of Vision 2030.”

ACWA Power respectively provides 14% and 33% of the power and desalinated water consumption in the Saudi Arabia.

The firm has 40 power and desalination projects in operation and under construction, and seven others in advanced stages of development.

Recently, ACWA Power achieved the lowest contracted solar tariff in the world for the 300MW Sakaka PV project (US Cents 2.3417/kWh), the first ever utility scale solar power project in Saudi Arabia.

Paddy Padmanathan, chief executive officer of ACWA Power, remarked: “The investment by PIF reflects its commitment to the Kingdom of Saudi Arabia’s energy transition plans of diversification of the fuel mix in power generation including the introduction of significant renewable energy capacity and the expansion of much needed additional power generation and desalinated water production capacity.

“While ACWA Power will continue to focus on reliably delivering electricity and desalinated water at the lowest cost, [it] also intends to leverage its domestic and international market-leading position to play a pivotal role in the Kingdom of Saudi Arabia’s energy transition plan, as evidenced by its recent successful bid for its first utility scale solar photovoltaics tender in February 2018.”



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