12th Jan 2008
by Florence Chong
MACQUARIE is awaiting decisions on bids it has lodged for two developments in Singapore - a sporting complex and a power station - with a potential investment of nearly $3 billion.
Macquarie expects to know by the end of this month if it has been chosen by the Sports Council of Singapore to build the proposed Sports Hub as part of a consortium featuring some of Australia's best-known organisations such as Lend Lease and the Australian Sports Commission.
The cost of the project has not been disclosed but those familiar with it told The Australian that such a project could easily cost $S1 billion ($783 million).
The bigger prize, however, is Tuas Power station, owned by Temasek Holdings, which is expected to choose the winning tenderer by the end of March.
Macquarie, which already owns power stations in South Korea, is one of up to nine parties shortlisted this week to buy Tuas Power station.
An Australian lawyer close to one deal confirmed that Macquarie was on the shortlist.
Given the size of the power station, the lawyer said, the station would be worth at least $US2 billion ($2.23 billion).
He added that Babcock & Brown had also expressed an interest (among a field of 30 potential investors) but was not shortlisted.
Others reported to be on the shortlist for the power station included Japan's Marubeni, Li Ka-shing's Hong Kong Electric, India's Reliance Energy, Malaysia's Tanjong, and China's Huaneng Power.
Local media reports said that in the next few weeks, those on the shortlist, including Macquarie, would have the opportunity to go through the books of Tuas as they began due diligence.
Tuas's management had been told to prepare presentations to potential buyers, with these "road shows" likely to begin as early as next week.
Temasek, owner of the power station, had declined to confirm the identity of those on the shortlist.
Tuas is the first of three power stations to be divested over the next two years.
Temasek executives had earlier said the timing was right to divest the assets because of persistent interest from potential investors.
Tuas Power's assets include oil-fired plants with a capacity of 1200 megawatts as well as 1470MW in gas-fired electricity plants.
The company recorded annual net profit of $S177 million to March 2007 on sales of $S2.28 billion.
The other two power firms that Temasek hopes to sell are PowerSeraya and Senoko.
They have capacities of 3100MW and 3300MW, respectively.
Together, the three power-generating stations are responsible for more than 80 per cent of power used in the city state.
http://www.theaustralian.news.com.au/story/0,25197,23040526-643,00.html