PCC1 acquires two more wind power projects

19:17 | 17/02/2020
Power Construction No.1 JSC (PCC1), after the VND195 billion ($8.5 million) mergers and acquisitions (M&A) with Lien Lap Wind Power JSC, keeps pouring capital into two more companies owning wind power projects in Quang Tri.
pcc1 acquires two more wind power projects
PCC1 now has three wind power projects in Quang Tri

PCC1 has just decided to invest more into wind power projects by acquiring 4.8 million shares of both Phong Nguyen Wind Power JSC and Phong Huy Wind Power JSC, equivalent to 96 per cent of each. PCC1 expects to implement the M&A in the first quarter of 2020 at an undisclosed value.

The two companies are in possession of wind power plants in Quang Tri province. In the last quarter of 2019, PCC1 also took over 4.99 million shares of Lien Lap Wind Power JSC, the investor of Lien Lap Wind Power Plant project in Quang Tri, valued at VND195 billion ($8.48 million), equal to VND39,000 ($1.7) per share.

According to information from Quang Tri Department of Planning and Investment, Lien Lap wind power plant has the designed capacity of 48MW, with the power output of 158.8GWh a year. The total investment capital of the project is nearly VND1.94 trillion ($84.35 million), of which the equity capital is 20 per cent. The project's operation duration is 50 years.

The two new transactions will bring the total up to three wind power projects in Quang Tri that PCC1 has acquired via M&A. Both Phong Nguyen and Phong Huy wind power were established in last August with headquarters located in Danang and the initial capital of VND330 billion ($14.35 million).

After three months of establishment, the two companies simultaneously reduced their capital to VND50 billion ($2.17 million) from November 2019. The shareholder structure of these two wind power businesses is similar. In particular, Mai Lieu Investment JSC owns up to 99 per cent of capital in both companies.

Besides the money spent to acquire the companies, PCC1 also needs to arrange significant capital to implement the projects. The total investment of these two projects is more than VND1.6 trillion ($69.57 million). Phong Huy wind power plant is built in Tan Thanh and Huong Tan communes (Huong Hoa district), with a capacity of 48MW. With the same capacity, Phong Nguyen Wind Power Plant (invested by Phong Nguyen Wind Power JSC) is built in Tan Thanh and Huong Phung communes (Huong Hoa district).

In the fourth quarter of 2019, PCC1 recorded the gross revenue of VND1.57 trillion ($68.26 million), up by a slight 4.1 per cent against the same period a year before. In the revenue structure, the segment that accounted for the largest proportion was construction and electrical equipment with VND884.5 billion ($38.46 million), up 21 per cent on-year.

Meanwhile, the strongest increase was in industrial production with VND406 billion ($17.65 million), 2.2 times higher than in the fourth quarter of 2018. In contrast, sales of goods and materials decreased from VND339 billion ($14.74 million) to VND72.5 billion ($3.15 million).

By Thuy Duong

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