Keppel Infrastructure Trust has entered a deal to acquire the 30 percent of the SingSpring Desalination Plant it doesn’t already own from Hyflux, through its judicial manager, for S$12 million, the trust’s manager said in a filing to SGX after the market close Wednesday.
“The strategic acquisition of the remaining 30 percent stake in SingSpring Desalination Plant will enhance the operational and business continuity of the asset, and also strengthen the cash flow stability,” Jopy Chiang, CEO-designate of Keppel Infrastructure Fund Management, the trust’s manager, said in the statement.
“This is an opportunity to increase our stake in a stable asset at a level which is expected to be accretive to distribution per unit and offer an attractive risk-adjusted return for KIT,” Chiang said.
The plant, located in Singapore’s Tuas area, was the city-state’s first large-scale seawater desalination plant; it is capable of supplying up to 136,380 cubic meters of potable water a day, the filing said, adding the plant uses a cost and energy-efficient reverse osmosis technology.
The deal is subject to approvals from Singapore’s national water agency PUB and SingSpring’s lenders, the filing said.
In a separate statement, Hyflux, which is under judicial management, said the employees of Hyflux Engineering who currently provide operations and maintenance services will be offered roles as employees of Keppel Infrastructure Holdings, which is KIT’s sponsor.