Australian energy company SP Ausnet has called an end to its arrangement with a subsidiary of Singapore Power that provides SP Ausnet with management services.
The company, which is listed in Singapore and Australia, said on Monday it has terminated its management services agreement with SPI Management Services (SPIMS) and will pay SPIMS a termination payment of $50 million.
It added that each SPIMS employee will be offered a transfer to SP Ausnet. The employee entitlements that have to be paid relating to the transfers will be deducted from the termination payment, as SP Ausnet has previously paid these amounts under the management services agreement.
SP Ausnet and SPIMS have also agreed to unwind shared information technology services that SPIMS subsidiary Enterprise Business Services provided to SP Ausnet, the company said.
SP Ausnet will move its share of these IT services provided by Enteprises Business Services to its own core IT department. The costs associated with this transfer will be at most $7.5 million, it said.
The termination payment and IT services restructure costs will be reflected in SP Ausnet's full-year accounts to be released on May 15.