China’s State Grid to buy 49% stake in Oman Electricity Transmission

Shanghai, China. Photo by Merlin Kraus on Unsplash

State Grid Corp. of China has agreed to acquire a 49% stake in Oman’s state-owned power transmission company in the first major privatization by the Middle East’s largest non-OPEC oil producer.

The Chinese state-owned company announced the deal on its website Monday, without providing any financial details. The statement confirmed an earlier Bloomberg News report. State Grid will buy the stake in a transaction that values Oman Electricity Transmission Co. at about $2 billion, people familiar with the matter have said.

The privatization attracted interest from large international investors and is the biggest in size in the country’s electricity sector, the people have said. The nation’s Nama Holding retain a controlling stake in Oman Electricity after the transaction.

The deal is a landmark for the Gulf Arab monarchy as it embarks on asset sales of government-owned entities to plug one of the largest budget deficits among oil exporters. It’s also a sign of China’s rising interest in the Middle East amid plans by President Xi Jinping to increase the nation’s political clout and revive ancient trading routes under his “One Belt, One Road” initiative.

Oman has one of the biggest budget shortfalls of all the sovereigns tracked by Fitch Ratings. The Gulf Arab monarchy’s finances have been hurt by lower oil prices, pushing the government to consider alternative sources of funding. It has been raising money from international debt markets to plug the deficit.

Oman Electricity owns and operates the nation’s main transmission network. The company, which is a subsidiary of Nama Holding, posted profits of 23 million rials ($60 million) for the first half of the year, compared with 17 million rials for the same period last year, according to information on its website.

Bloomberg

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In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

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  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.