Sembcorp Industries' India power arm, tipped by the market as a potential initial public offering candidate, has snagged a deal to supply power to neighbouring Bangladesh.
A unit of 93.73 per cent-owned Sembcorp Energy India (SEIL) is set to supply 250MW of power over 15 years, after winning a tender by the Bangladesh Power Development Board, said Sembcorp yesterday.
The utilities, marine and urban development group announced that it has got the letters of intent, with the supply of power from its super-critical coal-fired plant expected to start once procedural requirements and relevant government approvals are completed.
The power purchase agreement will be executed within 30 days of the letter of intent being issued, or at any later date as notified by the Bangladesh Power Development Board, according to a February request for proposals on its website.
SEIL managing director Vipul Tuli said in a statement that the bid "fits into SEIL's strategy of providing cost-competitive and reliable power, while prudently contracting our balance open capacity at viable tariffs".
Sembcorp noted that the outcome of the tender is not expected to have a material impact on the group's earnings per share and net assets per share for the year to Dec 31.
The counter ended lower by one cent at $2.65, before the announcement.