Thai Tap Water Supply Plc (TTW), the country’s largest private tap-water supplier, will aggressively expand into the energy business, aiming at income from power to account for 35% within five years.
As the market for water supply in Thailand grows saturated, TTW will begin booking revenue from power investments from the first quarter of next year onwards, said managing director Sompodh Sripoom.
TTW shareholders yesterday approved spending 2.76 billion baht to buy a 30% stake in CK Power Ltd, a unit of the SET-listed Ch Kanchang (CK) that operates Southeast Asia Energy Ltd (SEAN) and its Nam Ngum 2 hydroelectric plant in Laos.
The share acquisition of CKP marks TTW’s first investment in the power sector and its first project outside Thailand.
“These power projects are operating already. That’s why we think our investment is low-risk,” Mr Sompodh said.
By next year, TTW aims for realised revenue of 190 million baht from the acquisition.
A source from TTW said the company has eyed a few other energy projects for next year, including a solar farm.
Also, the company has been keen to participate in the US$3.7-billion Xayaburi project in Laos.
The contentious project has been postponed pending further environmental study. Asia Plus Securities said TTW would realise income from the Nam Ngum 2 project of at least 100 million baht a year.
Under the plan, TTW will buy 273 million shares out of 920 million shares of CKP. SEAN operates the 615-megawatt Nam Ngum 2 plant.
The TTW source said CKP was considering raising its stake in SEAN to 55%. SEAN owns 75% of Nam Ngum 2 Power, while the rest belongs to Electricity du Laos (EDL).
CK, Thailand’s third-largest construction firm by market value, holds 38% of SEAN, with Ratchaburi Electricity Holding and Bangkok Expressway owning 33% and 16.7%.
Shares of TTW closed yesterday on the Stock Exchange of Thailand at 5.25 baht, up 5 satang, in trade worth 19.64 million baht.
