GMR buys out Singapore's Island Power

Infrastructure group GMR today signed an agreement with international power producer InterGen NV to acquire the latter's 100-per cent stake in Singapore-based private sector power utility, Island Power.

The acquisition, which will enable GMR to enter the Southeast Asian energy market, is expected to cost the Indian Infrastructure major around $1.5 billion (Rs7,200 crore).

GMR already has a 50 per cent indirect control in Island Power, which it acquired through acquisition of a 50 per cent stake in InterGen in June 2008, the company said in filing with the Bombay Stock Exchange (BSE).

Island Power is currently building an 800 MW combined-cycle power project in Jurong Island of Singapore, which will use natural gas as feed stock, the company said in a media statement.

''We are delighted to have reached an agreement with InterGen. Island Power will be GMR's first and flagship project in Singapore and the South East Asia region, and we will be focusing our efforts on making this a success,'' Ng Quek Peng, head of GMR Group (South East Asia), said.

''We are confident that with the Group's considerable resources and sector experience, GMR will be able to develop Island Power, Singapore's first independent power project, into a successful, leading power producer. This is yet another step towards making GMR a truly global player in the infrastructure sector, having launched our international business in 2008 with the acquisition of a 50 per cent stake in InterGen,'' Ranjit Murugason, CEO of GMR International, said.

Construction of the power plant is slated to begin by the fourth quarter of 2010 and is expected to be completed by 2013.