ILB Group Berhad (ILB), a leading provider of rooftop solar power systems, has announced a significant acquisition to bolster its renewable energy capabilities. The company, through its wholly-owned subsidiary IL Energy Sdn Bhd (ILE), is acquiring a solar energy company and its assets for RM98 million in cash.
The acquisition is structured in two parts:
Armani Sinar Sdn Bhd (ASSB), a registered PV service provider specializing in engineering, procurement, construction, and commissioning (EPCC) of solar energy projects, will be acquired for RM30 million. ASSB focuses on commercial and industrial (C&I) and residential buildings, and this acquisition is expected to significantly enhance ILB’s market share and operational capabilities in the renewable energy sector.
The second part of the acquisition involves the purchase of a solar photovoltaic (PV) energy-generating system from Armani Energy Sdn Bhd (AESB) for RM68 million. This acquisition will boost ILB’s total solar asset capacity from 13 MWp to 30 MWp, expected to generate higher revenue and profitability through electricity sales to consumers under Net Energy Metering (NEM) agreements.
ILB’s strategic move aligns with its growth strategy to expand its solar energy business and become a major player in the renewable energy sector. The acquisition brings together the combined expertise of ILB and ASSB, enhancing project development and management capabilities. The expanded solar asset portfolio is anticipated to lead to economies of scale, reducing operating costs and improving profitability. Additionally, this acquisition positions ILB to capitalize on future opportunities in the Malaysian renewable energy market, including the LSS5 program.
The Malaysian government is actively promoting renewable energy through various policies and initiatives, with the solar energy sector expected to experience significant growth in the coming years. This acquisition positions ILB to benefit from this burgeoning market.
The completion of the acquisition is subject to certain conditions precedent. The solar energy sector is inherently risky due to potential changes in government policies and weather events. Moreover, there is no guarantee that the expected benefits from the acquisition will materialize.
Overall, this acquisition marks a significant step forward for ILB in its efforts to become a leading player in Malaysia’s renewable energy sector.
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