Thursday 28 Mar 2024
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KUALA LUMPUR (Feb 5): Integrated engineering services provider Serba Dinamik Holdings Bhd is acquiring a 40% stake in Maju Renewable Energy Sdn Bhd, Maju RE (Talang) Sdn Bhd and Maju RE (Temenggor) Sdn Bhd from Maju Holdings Sdn Bhd — which are controlled by businessman Tan Sri Abu Sahid Mohamed — for a combined RM24.85 million.

The wholly-owned subsidiaries of the target companies have been granted approval by the Sustainable Energy Development Authority Malaysia to develop hydro power plants within the Temenggor and Belum Forest Reserves in Perak, with a total of 60-megawatt (MW) generating capacity. They have also entered into renewable energy (RE) power purchase agreements with Tenaga Nasional Bhd to supply RE generated by the power plants to the national power grid.

The power plants will comprise a 27MW hydro power plant in Singgor, a 19MW hydro power plant Talang and a 14MW hydro power plant in Temenggor.

In a filing with Bursa Malaysia today, Serba said its wholly-owned subsidiary Serba Dinamik Group Bhd has entered into a Nemorandum of Agreement (MoA) with Maju, which currently owns 70% of the shares in each of the target companies, for the stake buy. The remaining 30% stakes in the three target companies are held by Perak Hydro Renewable Energy Corp Sdn Bhd.

Serba said it will fund the purchase entirely in cash through the proceeds from its initial public offering (IPO), which was completed on Feb 8 last year. Some RM95 million from the IPO proceeds have been identified for business expansion through investment and acquisition.

The MoA will create an opportunity for Serba to be awarded with the engineering, procurement, construction and commissioning (EPCC) contract for the power plants on a turnkey basis which is valued at approximately RM560 million.

Apart from the EPCC contract, Serba said it will also undertake the operation and maintenance contract for the power plants which is estimated to be RM10.56 million per year, based on the average cost of 2% per year on the capital expenditure of RM560 million.

As a shareholder of the target companies, Serba may also reap benefits in the form of dividends, it added.

Serba shares closed one sen or 0.28% higher at RM3.52 today, for a market capitalisation of RM5.17 billion.

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