PE-backed Maxpower sells stake in Myanmar unit to Mitsui
Mitsui & Co. has acquired a 44% stake in the Myanmar business of Maxpower Group, a Southeast Asia –focused gas power plant developer backed by Standard Chartered Private Equity (SCPE).
Maxpower primarily operates in Indonesia but entered the Myanmar market last year, becoming the first international developer to sign a power purchasing agreement with the government. The business is currently worth around $35 million and comprises 16 gas engine generator units with a capacity of 50 megawatts. It has a 30-year deal to sell electricity to Myanmar Electric Power Enterprise.
Mitsui is already the largest Japanese investor in Myanmar and plans on leveraging its participation in the Maxpower business to pursue other opportunities in the country's power sector.
"Maxpower Group was the first foreign company to enter Myanmar's power market last year. Sealing a new strategic partnership with Mitsui will enable us to fast forward the development of our project pipeline in Myanmar and beyond," Arno Hendriks, CEO of Maxpower, said in a statement.
Maxpower Group was until recently known as Navigat Energy. It started out as an equipment business and remains the second-largest global distributor of General Electric Jenbacher engines, having sold more than 1,000 MW of units through distribution licenses in Indonesia, Singapore, Thailand and Myanmar.
The Maxpower business - now the largest revenue driver - was established in response to demand not only for equipment but also skilled operators who could develop, own and operate power generation facilities. It currently has plants with a capacity of 450 MW in operation or under construction in Indonesia and Myanmar.
In May, Indonesia-focused PE firm Mahanusa Capital and Gunung Sewu Group invested $21 million in the company. The commitment followed a $25 million investment by SCPE in December 2013, which came in conjunction with a $279 million debt refinancing. SCPE first backed Maxpower in January 2012, putting in $58 million.
In July, a vehicle owned by the Indonesian government and several development finance institutions invested $12.5 million into an Indonesian subsidiary of Maxpower. Sumitomo Mitsui Banking Corporation is also participated.
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