KUALA LUMPUR (Oct 16): Tenaga Nasional Bhd (TNB) has submitted a conditional offer to acquire the power generation assets of Edra Global Energy Bhd from 1Malaysia Development Bhd (1MDB) for an undisclosed amount.

In a filing with Bursa Malaysia today, TNB said the conditional offer is subject to it finalising the confirmatory due diligence process, as well as finalising and executing the share purchase agreement (SPA).

Following its in-depth due diligence, TNB believes as Malaysia’s leading national power company, Edra’s power generation assets would be a strong fit for its growth strategy, domestically and internationally.

It added the conditional offer will be dependent upon the conditions being met by 1MDB, thus there can be no assurance that any transaction will be concluded.

Should TNB decide to pursue any transaction, other independent and third-party criteria and requirements would also need to be addressed, among others, an opinion from an independent adviser stating that the transaction is fair and reasonable, it said.

TNB said it will also get approval from non-interested shareholders for the transaction at a general meeting and receipt of all relevant approvals, consents, waivers and clearances from governmental, regulatory authorities and third parties for the transaction.

"A combination would ensure the long-term continuity of steady and competitively-priced power to domestic customers and consumers. It would also enable TNB to pursue its strategy of establishing a footprint in international markets, where growth in power demand is increasing," it said.

In a statement, TNB's president and chief executive officer Datuk Seri Azman Mohd said as the sole off-taker of all power generated in Malaysia, TNB is the best and most logical buyer for these assets.

"The acquisition of these power facilities, which will add a significant contribution to our power generation capacity in Malaysia, will be an important addition to our business, as it will further enhance TNB’s earnings and cash flow," he added.

He pointed out that broadening the group's domestic and overseas power generation base will give it more opportunities for revenue growth and for adding significant shareholder value.

“As the country’s largest power producer, no other bidder knows these assets better than TNB. Given our world-class track record in power generation and excellence in facilities management, the addition of these assets will unlock new value in TNB and will enhance future growth,” he stressed.

As a Malaysian company with a 65-year track record, Azman said TNB ownership of these assets will not only ensure the continuing Malaysian control of strategic power assets, but will allow the company to responsibly plan for the future growth of its business and Malaysia’s power needs.

Shares in TNB closed up two sen or 0.16% at RM12.80 today, bringing it's market capitalisation to RM72.24 billion.

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