Sembcorp sells Panama water business, gets S$21m net gain

SEMBCORP Industries has sold its entire stake in its water business in Panama, thus exiting the Panama market. The divestment resulted in a net gain of about S$21 million, the energy and urban development player said on Monday.

Sembcorp Industries' wholly-owned UK subsidiary, Sembcorp Holdings Ltd, completed a sale-and-purchase agreement to divest its entire stake in Sembcorp Investments Ltd, which wholly owns Aguas de Panama S.A.

The buyer is an affiliate of Seven Seas Water Corporation, a portfolio company owned by investment funds managed by Morgan Stanley Infrastructure Partners.

The gross consideration for the sale of equity shares was US$47 million and the consideration for the assignment of the shareholder's loan was US$1.8 million.

Aguas de Panama S.A. is a municipal water asset serving the Arraiján District in Panama under a 30-year concession that commenced in 2002. All parties took into account the remaining tenure of the concession in the sale consideration.

The net asset value of Sembcorp Investments Ltd and Aguas de Panama S.A. was S$38 million as at Oct 30, 2020.

GET BT IN YOUR INBOX DAILY

Start and end each day with the latest news stories and analyses delivered straight to your inbox.

Sign UpVIEW ALL

Sembcorp Industries said the divestment is in line with its capital-recycling efforts. It is not expected to have any material impact on its earnings per share and net asset value per share for the financial year ending Dec 31, 2020.

Shares of Sembcorp Industries closed at S$1.58 on Friday, down 3.1 per cent or S$0.05.