Tata Power ‘s Singapore-based arm TPIPL has signed an agreement with KS Orka Renewables Pte for sale of its 50 percent stake in OTP Geothermal Pte (OTP) for USD 30 million.
“The aggregate cash consideration for TPIPL’s 50 percent stake is USD 30 million. OTP, a 50:50 joint venture with Origin Energy, holds a 95 percent interest in Indonesia’s PT Sorik Marapi Geothermal Power (SMGP),” Tata Power said in a press release. OTP is a 50:50 joint venture between Origin Energy Limited and Tata Power International Pte (TPIPL). According to the statement, SMGP is currently pursuing development of 240 MW project in North Sumatra. The transition is expected to benefit the project development.
Tata Power has significant investments in Indonesia and remains committed to developing Indonesian power and energy sector. Company’s other investments in Indonesia include investments in PT Kaltim Prima Coal, PT Arutmin Indonesia and PT Baramulti Suksessarana Tbk. The divestment of TPIPL’s interest in OTP is consistent with the company’s strategy to constantly review its businesses and restructure, as required, to deliver long term value to shareholders, it said.
Tata Power said the sale is subject to customary Conditions Precedent (CPs) including approvals from relevant Indonesian government authorities. It targets to complete the sale in next three months, subject to satisfaction of the conditions stated above, it added.