PublicInvest positive on Malakoff’s possible divestment of wind farm

KUALA LUMPUR: PublicInvest research has a positive view on Malakoff Corp Bhd’s possible divestment of its 50% stake in Macarthur Wind Farm in Australia, estimated to be more than A$500mil (about RM1.4bil).

“We understand that it is likely to call for indicative bidding in May 2019 and complete the deal by 3Q19.

“While this is still in the preliminary stage, we view the divestment positively as it enables Malakoff to monetise its investment,” it said.

PublicInvest is keeping its forecasts pending further details from Malakoff. It has a trading buy recommendation on the counter with a target price of RM1.02.

“The disposal would not have a material impact on our core earnings forecasts as we expect the loss of income from the wind farm is offset by interest income from the sales proceeds,” it said.

To recap, Malakoff bought the 50% stake in June 2013 for A$130mil.

The farm in southwest Victoria is the largest wind farm in Australia and the southern hemisphere. Operating since January 2013, the facility has 140 turbines with a 420MW capacity and is currently operated by AGL Energy.

Source : TheStar