Bangkok--25 Jul--KASIKORNBANK
KASIKORNBANK and SPCG Pcl. are introducing a solar power infrastructure fund to raise 5 billion Baht of funds for investment in up to seven solar farm projects. The fund is expected to be an alternative fund raising tool for future infrastructure projects, as well as a secure investment alternative for investors.
Mr. Krisada Lamsam, Senior Executive Vice President of KASIKORNBANK, said KBank and SPCG are creating a historic fund raising channel via the infrastructure fund. Solar Power Co., Ltd., a subsidiary of SPCG, has appointed KBank as its financial advisor in fund raising via the infrastructure fund, to be worth 5 billion Baht, in order to finance up to seven commercial solar farm projects.
Located in Thailand’s northeastern region with plenty of sunlight to support solar farm operations, SPCG’s seven proposed solar power plants have promising business potential. Their sites were not impacted by the 2011 flooding. The seven solar power plants, with a combined capacity of 52.22 megawatts, or 7.46 megawatts each, would generate power of 41 megawatts in commercial operations, which would all be sold to the Provincial Electricity Authority of Thailand (PEA) under a five-year purchasing contract, automatically extended every five years.
The Solar Power infrastructure fund is likely to receive a warm welcome from investors due mainly to its solar farms’ high business potential with good locations, a secure revenue source under the long-term contract with the PEA, low operating costs and project aim that is in line with the government’s policy of renewable energy promotion. Kasikorn Asset Management will act as the manager of the fund, while the fund’s dividend to be paid to unitholders will be tax-free.
Mr. Krisada added that the infrastructure fund for solar farms highlights KBank’s leadership in the renewable energy market and the Bank’s potential in human resource development for financial innovation towards complete financial service. The mutual fund will also serve as a pilot project leading to similar future fund raising platforms for other infrastructure projects led by the private sector. With its relevant expertise, KBank stands ready to support customers accordingly.
SPCG Managing Director Wandee Khunchornyakong said Solar Power is developing a total of 34 solar farm projects scheduled to be completed by 2013, with a total investment of 24 billion Baht and a combined capacity of 240 megawatts. At this time, the first nine projects have been completed, while the 10th to 16th projects are the seven underlying projects that will be sold as the assets of the infrastructure fund. These seven projects are under construction and will be completed by the third quarter of this year. The mutual fund offering will be conducted after construction is complete.
Earnings of the seven projects are expected to be secured together with those of other projects of the company in nearby locations, which already generate revenues commercially under the purchasing contract with the PEA. Proceeds from the infrastructure fund will facilitate solar farm business operations up to the company’s full capacity. Solar Power is confident that the 34 solar power plants will be completed within 2013 as scheduled, and that it will become the leader of solar power in Thailand and other ASEAN countries.