KUALA LUMPUR (April 26): KPower Bhd has proposed to acquire the entire stake in hydro power plant developer One River Power for RM130 million, to be satisfied via a combination of cash and issuance of new shares in the group.

In a Bursa Malaysia filing on Tuesday (April 26), the group, which recently proposed to change its corporate identity, said its wholly-owned subsidiary KPower RE Sdn Bhd had entered into an agreement with Pristine Falcon Sdn Bhd for the acquisition.

According to the group, One River Power is principally involved in the development of three hydro power plants based in Sabah with a total combined power generation of 29.1 megawatt (MW).

“The proposed acquisition is envisaged to provide an opportunity to KPower to acquire the 29.1MW hydro power plants, which are partly operational and in line with the company’s asset ownership business model for long-term dividend sustainability.

“The proposed acquisition will enable the company to expand its income streams and further strengthen its position in the sustainable energy and utilities sector.

“As such, the proposed acquisition is expected to provide KPower with a profitable recurring income stream, which is expected to improve the company’s profit and provide better earnings visibility over the long term, thus enhancing shareholder value of the company."

It said that barring any unforeseen circumstances, prospects for One River Power are expected to be positive over the concession period of 21 years.

At noon break, shares in KPower were 1.5 sen or 2.75% higher at 56 sen, giving the company a market capitalisation of RM303.97 million.