GPSC moves on energy storage

PTT arm plans to serve growing market for renewable power

Global

Power Synergy Plc (GPSC), the power business arm of oil and gas conglomerate PTT Plc, is pushing ahead with its renewable power business by conducting a feasibility study of the energy storage segment in order to serve growing demand for electricity in the near future.

The strategic move comes after the company acquired a 69.11% stake in Glow Energy Plc from French giant Engie SA for 142.5 billion baht (equal to a price of 96.50 baht per share).

GPSC is positioning itself for the transition in Thailand’s power market.

Wanida Boonpiraks, executive vice-president for corporate finance and accounting at GPSC, said GPSC’s shortterm plan is to borrow 142.5 billion baht from local banks to fund the acquisition.

In the long term, the company plans to issue debentures worth 68.5 billion baht and raise capital of 74 billion baht.

The companies together set up a new team to restructure GPSC and withdraw Glow from Thailand’s stock exchange.

GPSC plans to hold an extraordinary general meeting of shareholders (EGM) on Aug 24 to request approval to acquire Glow and undertake the proposed financing.

In October, GPSC will acquire a 69.11% stake in Glow. The company will then conduct a tender offer for a 31% stake from minority shareholders between October and November.

GPSC will convene an EGM in the first quarter of 2019 and expects the deal to be completed in the same period.

GPSC president Termchai Bunnag said the renewable and energy storage sectors are emerging businesses in Thailand and around the world.

“GPSC wants to increase its share of renewable energy capacity over the 10% it holds in the domestic market,” Mr Termchai said. “It also wants to expand its overseas segment and its energy storage business.”

He said the acquisition deal will increase the value and performance of the two companies combined: “They will be more than the sum of their individual parts.”

The transaction is expected to be completed this year and is projected to help the company benefit from Glow’s high-quality assets, leverage potential business opportunities and increase its market presence nationwide.

“It’s a good business opportunity for GPSC because the company will not spend a large portion of its budget to construct a new power plant to serve PTT Group,” Mr Termchai said.

GPSC’s total generating capacity is 1,940 megawatts of electricity, 1,585 tonnes per hour of steam, 12,000 tonnes of refrigerated water and 2,080 cubic metres per hour of processed water.

The merger with Glow will triple combined capacity to 4,835 megawatts from 1,530MW.