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As mentioned in the earlier announcement, a party is proposed to acquire a 95% equity interest in PRSSB, which provides context. However, is it correct that only 180 days have elapsed since September 2024? You may connect the dots and draw your own conclusions.
The notice merely signals an intention to terminate and does not result in immediate termination unless expressly stated. It allows time for the company to appeal and negotiate before any termination becomes effective.
Solar farm is more urgent as it was placed under receivership by Bank Rakyat, whereas the hydro asset is less time-sensitive, as it has not been placed under a tender exercise yet, although its disposal is still needed to raise cash. The hydro asset should be worth significantly more than the solar asset.
They may negotiate a new PPA with TNB, as the existing PPA could be tied to the vendor. If this is unsuccessful, the project would carried little economic value, making it a significant risk for the acquirer.
Rumor has it that the owner was willing to sell for only around RM10 million. An additional RM50–RM120 million was required to complete the project. Moreover, the acquirer is buying without a PPA, so at this time, it’s unlikely to be worth more than RM100 million.
From the announcement, It is understood that the acquirer may acquire both the solar and hydro assets together with their liabilities, which could result in a substantial reduction of the company’s debt, subject to negotiations.
