Asia Power

To dispose entire 51% interest in subsidiary, Heilongjiang Asiapower Xinbao Heating & Power Co. for RMB204.4m (~S$42m). Priced at 33% premium to independent valuation done at end 2009, and 2.2x PB. Asia Power to realize net gain of ~RMB97m (after transaction costs and capital gain tax). Based on FY09 figures, NTA/sh to increase by 20% to S$0.30, while EPS to drop by 86% to S$0.23cts, vs last traded at $0.15…

Xinbao owns and operates a coal-fired combined heat and power plant in Heilongjiang province, with total installed capacity of 225 MW. Reasons for divestment include Group’s new focus on environmental-friendly and renewable energy power generation plants (especially hydro), unwillingness to commit more capital for capex at the power plant and poor expected future returns. Proceeds to be used for investment in renewable energy projects and working capital. Trading halt to be lifted at 9am.