Acquisition of GLOW Positions GPSC for Sustainable Growth
Global Power Synergy Public Company Limited (“GPSC”) has signed a Share Purchase Agreement to acquire 69.11% stake in Glow Energy Public Company Limited (“GLOW”) at a price of THB 96.5 per share, or approximately THB 97.56 billion in total and subsequently tender the remaining shares. The transaction is expected to complete within 2018. The acquisition will allow the company to benefit from GLOW’s high-quality assets, leverage on potential business opportunities and increase its market presence nationwide. GPSC will also gain significant operational synergy from synchronizing the existing infrastructure platform ensuring efficiency and system optimization for future sustainable growth at a regional level.
Dr. Toemchai Bunnag, President and Chief Executive Officer of GPSC, the innovative power flagship of PTT Group, announced that GPSC’s Board of Directors held on June 19th, 2018, approved the purchase of 69.11% stake in GLOW from ENGIE Global Developments B.V. for THB 97.56 billion, at a price of THB 96.5 per share.
“The acquisition of GLOW is strategically important for GPSC. It is a unique opportunity for GPSC to immediately expand its effective power production capacity to 4,835 MW, which underlines our long-term commitment to continue on a growth trajectory. This acquisition will enlarge our industrial customer base, in addition to the PTT Group and the Electricity Generating Authority of Thailand (EGAT), which aligns with our strategic growth plan driven by larger SPP (Small Power Producer) portfolio. We believe SPP is an integral part of Thailand’s industrial sector, which has strong growth prospect due its significant contribution to our economy,” said Dr. Toemchai.
With the combined portfolio and established infrastructure located adjacently, the company expects to achieve operational synergy driven by better load management and utilize shared resources to improve operational efficiency, leading to cost reduction as well as enhanced reliability of the power and steam distribution leveraging from shared technical know-how and experience of the two companies in order to serve our valued customers
GPSC plans to fund the acquisition and tender offer with a bridge loan from financial institutions and/or major shareholder(s). For long-term funding plan to repay the bridge loan, GPSC is preliminarily considering issuing corporate bonds and/or long-term loans from leading financial institutions approximately half of the bridge loan. The remaining portion will be funded by equity issuance.
“I am also pleased to announce that GPSC has signed a Share Purchase Agreement with ENGIE Global Developments B.V.The acquisition represents an excellent opportunity which will support our sustainable growth enabling us to increase the reliability of electricity generation and distribution to our customers, as well as move towards innovative power businesses. Together with GLOW, we can leverage our respective strengths, competencies to maximize benefits from operational synergy and competitiveness. GPSC aims to be the leading power producer, providing a range of services to meet the diverse needs of our customers in the future,” concluded Dr. Toemchai.