On November 24, 2015, Malaysia’s heavily indebted 1MDB announced that it is selling its energy unit, Edra Global Energy Bhd, which owns 13 power plants across Malaysia, Egypt and Bangladesh for $2.3 billion to the China General Nuclear Power Corporation (CGNPC). This price is far below what 1MDB originally paid for these strategic assets. Proceeds from the sale will be used to pay off some of the $9.9 billion in debt held by 1MDB. CGNPC outbid Malaysian state-owned power company Tenagan Nasional, prompting its own Hong Kong-listed unit CGN Meiya Power Holdings to withdraw its bid, citing CGNPC‘s greater financial strength and ability to close the deal quickly. Malaysian laws limiting foreign ownership of local power assets only to minority stakes were waved for CGNPC.
Edra Global Energy‘s assets have a generating capacity of 3112MW within Malaysia and 2482MW within Egypt and Bangladesh. It is the largest independent power producer in Bangladesh and Egypt and is the second largest independent producer in Malaysia, providing 18% of Malaysian electric demand. The deal has allowed CGNPC to cement itself not only in the Malaysian energy market, but in that of Egypt and Bangladesh as well.