Exxon selling its share in Hong Kong’s Capco

• 10 years ago (2013-11-20)
• Junior Isles

Asia 850 North America 998

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US power giant ExxonMobil is selling its 60 per cent share in Hong Kong power generation firm Castle Peak Power (Capco) to CLP Holdings and China Southern Power Grid, according to a CLP announcement.

Capco owns three power stations in Hong Kong ‒ Castle Peak Power Station, the Black Point Power Station and the Penny's Bay Power Station ‒ with a total power generation capacity of 6908 MW.

The deal is part of a routine review of Exxon’s business portfolio and is said to be worth HK$26 billion ($3.4 billion), including Exxon’s majority stake in a pumped storage entity.

CLP will acquire the entirety of ExxonMobil's 51 per cent holding of Hong Kong Pumped Storage Development Co., worth HK$2 billion ($260 million), leaving it with full ownership of the company.

"We continuously assess opportunities for growth, divestment or restructuring to see if they fit in with our overall business objectives,” an Exxon spokesperson said.

The sale will result in CLP raising its stake from 40 per cent to 70 per cent, with CSG owning the remaining 30 per cent.

CLP has said the deal was decided "after arm's length negotiations between the parties, with talks between the three companies reportedly stalling earlier in the year with a disagreement on valuations.