China Huaneng Group, the nation's largest power producer, announced Friday that it has reached agreement with the Singapore's state-owned investment company, Temasek, on buying a Singaporean energy company for 4.235 billion Singapore dollars (three billion U.S. dollars).
The Beijing-based power group will achieve the takeover through its wholly-owned subsidiary in Singapore. It will inject 985 million U.S. dollars into the subsidiary.
Huang Long, vice general manager of Huaneng Group, said the deal meant the group has taken a new step forward in its overseas development strategy.
Analysts said the move is part of Chinese power companies' efforts to have a presence overseas. Last year State Grid Corp of China, the nation's largest electricity transmission network, took part in a bid to operate the Philippine power grid.
As China's largest power producer, Huaneng Group boasted more than 325 billion yuan in gross assets at the end of 2007 and a total installed capacity of 71,570 million watts. It owns a 50 percent stake in Australian power generation joint-venture firm OzGen.
Tuas Power Ltd., founded in 1995, is one of the three leading power generation companies in Singapore.
Huang Long said Tuas Power Ltd. would become an important part of Huaneng's investment portfolio and Huaneng would continue to supply environmental-friendly, reliable electricity for Singapore.
Huaneng will complete the Singapore deal before the end of this month.