Saudi Arabia's utility giant, ACWA Power, has divested a 30% stake in the Rabigh Independent Water Steam and Power Project (IWSPP) for $225 million. The buyer is Hassana Investment Company, the investment arm of the kingdom's General Organization for Social Insurance (GOSI).
This transaction marks a strategic move for ACWA Power, aligning with its capital recycling strategy. The company, previously holding a 99% stake in the project, aims to unlock capital for potential reinvestment in new ventures.
The Rabigh IWSPP is a vital utility provider for the Petro Rabigh Company, an industrial complex in Saudi Arabia. The project supplies essential water, steam, and power through a joint venture comprising ACWA Power, Marubeni Corporation, JGC Corporation, and Petro Rabigh itself.
The details of the agreement involve the sale of a 30% interest in Rabigh Arabian Water and Electricity Company (Rawec), the entity that owns and operates the IWSPP. The project itself boasts an impressive infrastructure, including conventional thermal power generation with five 118-megawatt steam turbines, nine high-capacity steam generators, and advanced emission control systems. Additionally, a significant seawater desalination component featuring numerous reverse osmosis trains ensures a steady supply of treated water.
Financial details suggest that ACWA Power expects to generate a profit from the divestment. While the specific figures are not publicly disclosed, the company's confidence in a positive outcome underscores the Rabigh IWSPP's strong operational performance and potential for future growth.
Industry experts view this transaction positively. ACWA Power's capital recycling strategy is seen as a prudent approach to portfolio management, enabling the company to pursue new opportunities while leveraging its expertise in developing and managing large-scale utility projects. The deal also highlights the growing role of institutional investors like Hassana in supporting Saudi Arabia's infrastructure growth.
The divestment is not expected to disrupt the Rabigh IWSPP's operations. ACWA Power remains a significant stakeholder, ensuring continuity and expertise in project management. With a strong foundation and a strategic ownership structure, the Rabigh IWSPP is well-positioned to deliver essential utilities to the Petro Rabigh complex for years to come.