CLP Holdings, Hong Kong's largest power utility, said on Monday it would sell a 1,320 megawatt coal-fired power station in Taiwan to joint venture firm OneEnergy for US$500 million.
CLP said in a statement OneEnergy, a venture between CLP and Japan's Mitsubishi, would pay US$410 million in cash with the remainder to be settled by issuing 9,000 new OneEnergy shares to CLP upon completion of the deal.
The Hong Kong-listed power play said it expected to see a one-off gain of about HK$1 billion after the deal, and the cash proceeds from the deal would be used for general working capital.
The equally owned OneEnergy venture was set up to develop and operate power business in Southeast Asia and Taiwan.
Mitsubishi took a 50% stake in OneEnergy in March 2006 for US$335 million. CLP had in March last year injected its indirect 22.42% stake in regional power play Electricity Generating Public into OneEnergy.
In October 2006, CLP also sold a 50% stake in BLCP Power, which owns a 1,434 Megawatts coal-fired power station in Rayong Thailand, to OneEnergy for HK$1.4 billion.
CLP, which is expanding across the Asia Pacific region to diversify away from the mature Hong Kong market, said in February it would keep hunting for overseas opportunities to drive growth despite some notable failures on that front.
Shares in the company have fallen 3% so far this year to close at HK$55.60 on Friday.