May 6 (Renewables Now) - Malaysian investment holding company ARB Berhad (KLSE:ARBB) has entered into an agreement to acquire a 51% stake in local solar developer C&M Renewable Energy Technology Sdn Bhd (CMSB) for a total consideration of MYR 5.5 million (USD 1.3m/EUR 1.2m).
ARB said in a bourse filing this morning that its interest in CMSB stemmed from the renewable energy company’s agreement to install, operate and manage a solar photovoltaic (PV) system at the USM Faculty of Engineering on a 364-acre site in Nibong Tebal in the state of Penang. CMSB signed the agreement with USAINS Infotech Sdn Bhd (UISB), the corporate arm of the University Sains Malaysia (USM), in November 2018.
ARB expects that the solar project will generate a cash flow of between MYR 5 million and MYR 11 million each year. The net present value is estimated to reach MYR 100 million based on a discount rate of 5.6% over the project’s 30-year concession period.
Once all the conditions have been met, ARB will pay for the stake, held by CMSB director and CEO Lee Ping Wei, in cash and with own funds. The acquisition is expected to be finalised by the second half of 2019.
(MYR 1.0 = USD 0.24/EUR 0.22)