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Chairman's Message |
It is an honour for me to serve Tuas Power Ltd as its new Chairman, following the company’s
acquisition by China Huaneng Group (CHNG).
A winning outcome
The transaction was completed on 24 March 2008 after an intense and competitive bidding
process. Through a wholly-owned subsidiary, SinoSing Power Pte Ltd, CHNG paid S$4.235
billion for Temasek Holdings’ 100 per cent interest in Tuas Power Ltd. From CHNG’s
perspective, the acquisition is significant in two respects: it is the largest asset acquisition
that CHNG has made to date and by far the biggest direct foreign investment ever made by
a Chinese power enterprise; and it will provide CHNG a decent return as well as an international
platform for CHNG to extend its reach.
Based in Beijing, CHNG is the largest power generation company in China. With an installed
generation capacity of more than 71,000 MW, it is also the fourth largest electricity provider
in the world. As at 31 December 2007, total assets for CHNG exceeded RMB 376 billion
(approximately US$45 billion). It is a diversified business, whose portfolio includes power
generation as its core business, financial services and infrastructure developments
such as coal, transportation and port facilities. In addition to being the controlling shareholder
of Huaneng Power International, Inc., which is listed on the New York, Hong Kong and Shanghai
stock exchanges, CHNG owns a 50 per cent stake in the Australian power generation joint-venture
company, OzGen.
A strategic match
Tuas Power is an excellent fit for CHNG in many ways. As one of the three major power
generation companies in Singapore, Tuas Power comes with a superb power generation facility
and another equally important asset – a strong team of management and staff. More than this,
however, I am certain that Tuas Power will prove to be a vital component in the strategic
development of CHNG as a whole.
With Tuas Power under its wing, CHNG will be able to diversify its regional management risks,
improve its fuel structure and raise its total profit. Tuas Power also serves as a good platform for
CHNG to develop its business overseas. By being in a position to compete directly in the
Singapore power generation and electricity retail markets, CHNG will accumulate valuable
experience in operating in competitive electricity markets and hone its expertise in managing
foreign investments.
A smooth transition
The acquisition of Tuas Power is therefore expected to yield long-term strategic benefits
as well as short-term gains for CHNG.
CHNG will continue to do its best to strengthen Tuas Power as a competitive,
reliable and environmentally responsible power generation company in Singapore.
At the same time, CHNG will continue to support Tuas Power on the development
of new power related projects.
Based on sound corporate governance principles, Tuas Power’s original Board of Directors will
continue to guide the Company, aside from the addition of two members from CHNG. I have full
confidence in the current team, a confidence that is well-founded on its impressive track record in
running the Company.
Our shared purpose
Having established this seamless transition, all of us at Tuas Power will endeavour to meet our
shared objectives. These include ensuring safe and steady production; strengthening cost
control; proactively and progressively pushing forward the development of new projects;
ensuring the personal safety of our employees; earning comfortable returns and fulfilling our social
responsibility by continuing to lower emissions.
Tuas Power has come a long way since November 1998, when it started trading
electricity and competing to generate in the Pool. With the constant support of our customers
and the conscientious efforts of every employee, I look forward to Tuas Power reaching even
greater heights of achievement and contributing to the continuing economic development of
Singapore and China.
Thanks
I would like to express my sincerest appreciation to Mr Lim How Teck, who served as Chairman
from June 2005 to March 2008, for steering Tuas Power’s growth with his wealth of
experience and insights. I am very happy that he has agreed to continue serving on
the Board as Deputy Chairman, and I look forward to working closely with him and the
Board to propel Tuas Power into the next phase of growth.
Huang Long
Chairman (since March 2008)
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