SET-listed Scan Inter Plc (SCN), a natural gas trader and operator of compressed natural gas (CNG) stations, has increased its registered capital by 97.63 million baht via a private placement (PP) to beef up its solar power plant operation in Myanmar.
The registered capital comes at an offering price of 4.50 baht per share.
Scan's board of directors resolved last Friday that an extraordinary shareholders meeting approved an increase in registered capital by issuing 21.7 million newly issued ordinary shares for two companies -- Noble Planet and Planet Energy Holding.
Scan has registered capital of 600 million baht.
Scan's letter to the Stock Exchange of Thailand said those two companies will transfer their shares -- 12.4% and 6.6% -- in Green Earth Power (GEP) Thailand to Scan in consideration for the additional ordinary shares of GEP Thailand that Scan will acquire.
GEP Thailand is constructing a power plant in Minbu City, Myanmar, with installed capacity of 220 megawatts, making it the largest solar power plant in Southeast Asia. The project is valued at 10 billion baht.
All transaction processes will completed by January.
Scan said the PP deal is part of a strategy to increase its shares in GEP Thailand from 30% to 49% in the near future.
Scan earlier planned to buy an additional 21% of shares in GEP Thailand, but the board cancelled that plan as the additional shares would give Scan a controlling stake in GEP Thailand with a 51% stake.
"Scan would have had the right to appoint half of the directors in GEP Thailand, which might affect the calculations of the transaction size according to Securities and Exchange Commission regulations," Scan said.
In mid-May, Scan entered into an agreement to purchase 30% of issued shares in GEP Thailand for 1.235 billion baht.
Littee Kitpipit, Scan's managing director, said the project is divided into four phases, with the first phase of construction and power generation totalling 50MW expected to be completed by 2019.
He forecasts this project will have an internal rate of return of over 10%.
"GEP Thailand is the holding company that wholly owns GEP Myanmar for this project, which has a 30-year power purchase agreement concession from the Electric Power Generation Enterprise," said Mr Littee.
"This overseas investment is in line with Scan's strategy to create a business unit that generates recurring, sustainable income."
Scan wants to diversify its energy business from CNG trade to other renewable power projects. The company is seeking other business partners to expand clean-energy operations to overseas countries.