2 Dec Sembcorp mulls acquisitions to tap migration to cities

2 Dec Sembcorp mulls acquisitions to tap migration to cities
Above photo is Mr Tang.

SINGAPORE - Sembcorp Industries Ltd, South-east Asia's biggest utilities company, plans to acquire and develop new plants as Asia's population increasingly migrates to cities, driving demand for resources.

The Singapore-based company is considering the acquisition of distressed assets in India and has dispatched a team to seek investments in Myanmar, chief executive officer Tang Kin Fei said in a Nov 27 interview.

Sembcorp also is seeking opportunities in Indonesia, he said.

"We're still very bullish," said Mr Tang, 61.

"Over a longer period of time, we still see increasing demand for development in the Asian region. With this growth and population moving from rural areas to new urbanisation there is demand for power and water."

The projects will help Sembcorp take advantage of faster growth in emerging markets as it faces more competition in Singapore, where it gets 68 per cent of its profit from utilities.

It aims to boost its energy output by 72 per cent in the next three to four years, and water production by 37 per cent in four to six years, Mr Tang said.

The shares climbed 3.6 per cent to US$5.15 (S$6.28) at the close in Singapore, the highest since Nov 5.

The stock has risen 28 per cent this year, outpacing the 15 per cent gain in the Straits Times Index.

The company has moved into Oman through a venture and expanded into renewable energy with the acquisition of a stake in a wind farm in China.

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