Saudi firm buys stake in Jordan's largest power generator

ACWA Power announces major deal as part of company's plan for regional expansion
Saudi firm buys stake in Jordan's largest power generator
electric pole, electrical energy, GCC energy, power generation
By Andy Sambidge
Sat 04 Jun 2011 10:53 AM

A Saudi Arabian company said on Saturday it has completed a deal to take a stake in Jordan's Central Electricity Generation Company (CEGCO).

ACWA Power International, which develops privately owned and financed power generation and desalinated water production plants, said it had inked an agreement with Jordan Dubai Capital (JDC) which owns a 65 percent stake in Enara Energy Investments, which in turn holds 51 percent ownership of CEGCO.

ACWA Power, which first expanded outside Saudi Arabia with a deal in Oman last year, said the transaction values 51 percent of CEGCO at $144m.

CEGCO is the largest power generator in Jordan, with seven power generation complexes nationwide totalling about 1,700 megawatts (MW) of power capacity, meeting around 59 percent of the country's current electricity consumption.

"We are excited about this acquisition, after establishing in Saudi Arabia a strong asset base with a contracted production capacity of about 6,485MW," said Mohammad Abunayyan, chairman of ACWA Power.

"This acquisition marks our entry into the second market in line with our regional expansion plan, following last year's successful acquisition of Barka I IWPP in the Sultanate of Oman. The stable investment climate of Jordan and the socio economic growth potentials give us a perfect platform to build our regional growth ambitions."

Upon completion of the acquisition, ACWA Power will own a 65 percent controlling stake in Enara, while Malakoff, the Malaysian electricity company, and the Athens-based Consolidated Contractors Company, each will continue to own 25 percent and 10 percent respectively.

CEGCO will continue to be owned 40 percent by the Government of Jordan; 9 percent by the Social Security Corporation of Jordan and 51 percent by Enara.

Paddy Padmanathan, president and CEO of ACWA Power, said that power generation capacity in Jordan needed to double, adding that ACWA Power is currently prequalified for power projects in Jordan.

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