RIYADH: Saudi utility firm ACWA Power has finalized deals to sell 35 percent of its stake in two subsidiaries to China Southern Power Grid International for SR595.9 million ($158.87 million).
In a statement to Saudi stock exchange Tadawul, the Public Investment Fund-backed company announced the closing of the sale and purchase agreement for its shareholding in ACWA Power Bash Wind Project Holding Co. and ACWA Power Uzbekistan Wind Project Holding Co.
The SPAs were signed between ACWA Power Green Energy Holding and China Southern Power Grid International, with the Saudi firm now holding a 65 percent stake in these two projects following the successful completion of the conditions precedent.
ACWA Power has been pursuing renewable energy development goals in various countries to expand its footprint and contribute to global sustainable energy solutions.
The sale is part of the company’s capital recycling strategy, complementing its business model to partner with robust and reputable equity partners.
Marco Arcelli, CEO of ACWA Power, said: “Through strategic collaboration with China Southern Power Grid International, we are proud to announce a significant milestone in our journey toward sustainable energy solutions.”
ACWA Power is developing the Bash 500 megawatts and Dzhankeldy 500 MW wind farms in Uzbekistan under a 25-year power purchase agreement with JSC National Electrical Grid of Uzbekistan.
Located in the Bukhara region, these projects aim to collectively generate 1 gigawatts of renewable energy under a Build, Own, Operate, Transfer model, with an estimated total investment cost of SR5.1 billion during construction.
Arcelli added: “The agreement in relation to our Bash and Dzhankeldy wind projects in Uzbekistan not only enhances ACWA Power’s global presence but also strengthens ties between two industry leaders from different regions.”
The SPA signing ceremony to complete the deal was held in the Uzbek capital, Tashkent, and marks the first significant collaboration between ACWA Power and China Southern Power Grid in Central Asia.
“This historic partnership underlines our commitment to driving innovation and progress in the renewable energy sector,” said the CEO.
The deal follows ACWA Power’s memorandums of understanding with nine Chinese entities at the December 2022 Riyadh Arab-China Summit, focusing on developing global clean energy projects in Saudi Arabia and countries of the Belt and Road Initiative.
Once fully operational, the Bash and Dzhankeldi independent wind power plants will be among the largest renewable energy projects in Central Asia, the company said.
“By leveraging synergies, we can strengthen our strategic partnership and work toward developing a series of benchmark projects and contribute to the implementation of the Uzbekistan-2030 Strategy,” said TANG Yifeng, vice president of China Southern Power Grid Co.
Uzbekistan represents ACWA Power’s second-largest market in terms of total investments, after its primary market in the Kingdom.
