ACWA Power signs SAR 2.6B deal to acquire power, water assets in Kuwait, Bahrain

Logo of ACWA Power Co. 

ACWA Power Co. signed an agreement to acquire power and water assets in Kuwait and Bahrain for 2.6 billion riyals ($693 million).

For more news and details on M&As

The deal includes a 4.6-gigawatt combined-cycle power generation portfolio and desalination capacity of 1.114 million cubic meters per day, as well as associated operations and maintenance companies, ACWA Power said in a statement to Tadawul.

The assets are being acquired from Kahrabel FZE, a subsidiary of France’s Engie.

ACWA Power said the buyer would be newly established subsidiaries formed after the agreement's signing. The acquisition will be financed through the company’s internal cash resources and external funding.

The structure of the acquisition process includes an 18% stake in the Az Zour North power plant, as well as 45% stakes in both the Al Ezzel power plant and the Al Dur power plant, along with a 30% stake in the Al Hidd power plant, all located in Bahrain.

Additionally, a newly established company under ACWA Power will acquire the operation and maintenance companies for these stations. This involves a 50% stake in the operation and maintenance company for Az Zour North power plant, as well as full ownership (100%) of the operation and maintenance company for Al Ezzel power plant.

The acquisition includes several key power generation and water desalination assets in Kuwait and Bahrain. These assets comprise the Az Zour North power plant in Kuwait (1,520 MW and 486,000 m³ of desalinated water daily), the Al Ezzel power plant (940 MW), the Al Dur power plant, and the Al Hidd power plant in Bahrain, with capacities of 930 MW and 1,220 MW for power and 218,000 m³ and 409,000 m³ of desalinated water daily, respectively.

The deal is aimed at strengthening the company’s position as the global leader in water desalination while also expanding its presence in the power generation markets. It is designed to enhance the company’s cash flow and profitability through signed contracts. The targeted assets in the acquisition are fully operational, managed, and maintained to the required standards.

Moreover, the acquisition will support the company’s goals of increasing profitability and free cash flow for equity holders while also reinforcing its leadership position in both the power generation and water desalination sectors.

Additionally, it will expand the company's operational and maintenance capabilities. This acquisition marks ACWA Power's first step into the Kuwaiti market with a stake in the Az Zour North power plant, further supporting its strategic efforts to expand its presence within the regional energy and water sector.

To view the financial statements of the acquired assets, click here: 

Al Ezzel Power Company B.S.C. (c)

AL DUR POWER & WATER COMPANY B.S.C. (C)

Shamal Az-Zour Al-Oula Power and Water Company KSC (Public)

HIDD POWER COMPANY B.S.C.(C)

AL EZZEL OPERATION AND MAINTENANCE COMPANY W.L.L.