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6 October 2003 - The UK's Scottish and Southern Energy (SSE) has bought out its partners in the 700 MW Medway Power combined cycle gas turbine on the Isle of Grain in Kent for £89.8m ($150m) the company announced late Friday.
SSE had 37.5 per cent of the plant before and has bought stakes from AES of the US and EdF of France. It now controls all the shares belonging to AES Medway Electric and EdF Energy.
SSE has also assumed net debt in Medway of £140.9m. The deal is expected complete by early November. SSE also takes control of AES Medway Operations, which operates and maintains the power station, for GBP11.7-mil in cash. SSE said the deal should enhance its earnings, pre and post goodwill, in the first year.
The plant has sales contracts, which run to 2011to supply power to SSE and to EdF Energy. SSE said that it would get the economic benefit from having a 100 per cent ownership. Ian Marchant, SSE chief executive, said the move would bolster its position in the "dramatically changing" electricity market. "The growth in renewables will need to be backed up by efficient, flexible gas-fired power stations and this acquisition enables us to add another to our group of generation assets," he said.
AES Corporation will sell its ownership interest in Medway Power Limited (MPL) and AES Medway Operations Limited (AESMO) in an aggregate transaction valued at approximately £47m. Paul Hanrahan, President and Chief Executive Officer of AES, commented, "This strategic sale demonstrates our commitment to continually assess our investment portfolio worldwide to ensure we are maximizing value for our shareholders. In this case, we are selling a business at a price we believe is attractive relative to maintaining our minority ownership in the business."
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