Engineering and energy solutions provider, KAB is eyeing higher revenue contributions from its sustainable energy solutions (SES) segment, after the acquisition of its first mini hydro power plant in North Sumatera, Indonesia.
The concession for the Kombih III mini hydro power plant is expected to generate at least RM270 million revenue for the Group over the concession period of 20 years.
KAB has made the annoucement through its official release today that its wholly owned subsidiary KAB Energy Holdings had entered into a Share Sale Agreement with Sarawak Cable to acquire the entire issued share capital of the latter’s subsidiary PT Inpola Mitra Elektrindo (PT IME) for RM10,000 purchase consideration. PT IME will be released from all liabilities and encumbrances upon full settlement of the purchase consideration and outstanding debt of up to RM75 million.
PT IME had designed, constructed, developed and now owns and operates the Kombih III mini hydro power plant in North Sumatera, Indonesia, which commenced commercial operations in October 2021 with 11 megawatt installed capacity. It then began supplying electricity to Indonesia’s state-owned utility company PT Perusahaan Listrik Negara for the 20-year concession period.
Prior to this latest acquisition, KAB’s SES segment derived its revenue from various renewable and clean energy projects in Malaysia and Thailand, comprising solar photovoltaic systems, co-generation facility and waste-to-heat recovery systems.
For the record, the Group’s SES segment made up RM6.8 million or 3.9% of KAB’s total revenue for the financial year ended 31 December 2021 (FY2021). Meanwhile, its contribution increased to 7.6% or RM4.0 million for first quarter ended 31 March 2022 alone, and is anticipated to rise further.