Keppel Corporation Limited (Keppel Corporation), Keppel Asia Infrastructure Fund LP (KAIF) and a co-investor of KAIF, through Cloud Alpha Pte Ltd, are acquiring a 51% equity interest in Cleantech Renewable Assets Pte. Ltd. (CRA or Cleantech) for up to US$150 million. The remaining 49% of the equity interest in Cleantech is held by its existing shareholder, Shell Eastern Petroleum (Pte) Ltd. (Shell), which will continue to support its future growth in the region.
Headquartered in Singapore, Cleantech is a leading solar energy platform focused on the commercial and industrial (C&I) segment. The company has a total capacity of over 600 MW across the various stages of operations, construction, and development, with its assets located across India and six countries in Southeast Asia (Thailand, Malaysia, Indonesia, Cambodia, Singapore and Vietnam). In addition, Cleantech is targeting to achieve a cumulative generation capacity of 3 GW over the next 5 years.
As one of India’s largest open access platforms and its second largest rooftop solar energy platform, as well as a leading solar energy player in Southeast Asia, Cleantech has strong and proven in-house capabilities for project development, engineering, procurement, construction, asset management and financing of solar facilities. On the back of various commitments undertaken by nations and companies towards achieving Net Zero targets, Cleantech is expected to benefit from the growing demand for renewable energy in the region.
Cleantech has around 120 credit-worthy and top tier customers,95% of which are spread across five energy intensive sectors including auto, industrial, consumer and retail, energy and chemicals, and textile, and include companies such as Apollo Tyres, Cargill, Coca Cola, Shell Lubricants, Akzo Nobel, Kerry Ingredients, Kuehne + Nagel, among others.
Mr Loh Chin Hua, CEO of Keppel Corporation, said, “The investment in Cleantech reflects Keppel’s commitment to sustainability and our Vision 2030 plans to grow our renewables business. It allows us to not only tap the expertise and experience of Cleantech in solar energy projects, but also explore opportunities for collaboration with other parts of the Keppel Group. Through acquiring a majority stake in an established platform together with KAIF and a like-minded investor, we would be able to accelerate Keppel’s growth in the renewables space, as we work towards achieving and surpassing our target of 7GW of renewable energy assets by 2030.”
KAIF is managed by Keppel Capital Alternative Asset Pte. Ltd., a private fund manager under Keppel Capital. Launched in January 2020, the KAIF Partnership and its co-investment vehicles have aggregate commitments of approximately US$1 billion from global institutional investors. KAIF achieved its final close this year. Building on the Keppel Group’s collective strengths and ability to create quality investments that are highly sought after by global investors, KAIF is uniquely positioned to invest in critical infrastructure assets which provide essential services.
The investment in Cleantech marks KAIF’s first renewable energy investment and will form its beachhead into the burgeoning solar energy sector in Asia Pacific. The fund, together with its co-investment vehicles, also has a 30% interest in the Gimi floating liquefied natural gas (FLNG) facility, which is currently undergoing conversion at Keppel Offshore & Marine.
Completion of the transaction is subject to and conditional upon certain customary conditions including regulatory and other approvals. The transaction is expected to close in 1Q 2022.
The above-mentioned transaction is not expected to have any material impact on the earnings per share and net tangible asset per share of Keppel Corporation for the financial year ending 31 December 2021.