KNM

Its rm2.3 billion RE plant project in Peterborough , the UK is on track having completed the acquisition of a 55 acre tract in Peterborough for 25 million pound. The land, acquired through the purchase of a company named Poplar Investments Ltd will be the site for the 80MW RE plant project that was announced in 2010. The securing of the site clears the way for KNM to obtain financing for the project, hopefully in Nov 2012.

 

Some 80% of the RE plant’s rm2.3 billion investment will be provided through a syndicated loan by Exim Bank with the remaining 20% through equity financing. KNM owns 80% of the E plant project through its 80% stake in a vehicle named Energy Park Investments Ltd.

 

KNM’s gearing will increase once the syndicated loan is secured for the RE plant project.

 

As at June 2012, the group’s total net borrowings amounted to rm861 million versus its shareholders fund of rm1.64 billion. Nonetheless, this was to account for its recent rights issue that raised rm196 million cash.

 

After securing the financing with the Exim Bank, KNM can commence the construction of the first phase of the RE plant by the 1QFY2013. Meanwhile part of the engineering, procurement and construction contract from the Peterborough RE project will go to KNM’s unit Borsig GmBH. This will help to ensure a steady order flow to the German subsidiary which is expected to be listed in SGX in Aug 2013 for an indicative valuation of rm1.9 billion.

 

KNM acquired Borsig for about rm1.7 billion in 2008.