Saudi Arabia’s sovereign wealth fund Public Investment Fund has acquired a 15.2% stake in power generation firm ACWA Power, the companies said in a joint statement.
PIF’s latest investment will bring its overall share in ACWA Power to 24.98%, as it adds on to a 9.78% share in ACWA Power through its wholly-owned subsidiary Sanabil Direct Investments Company.
The cash from the new investment will be used to grow ACWA Power’s growth strategy and its investment plan, the statement said.
Founded in 2004, Riyadh-based ACWA Power has a total of 40 power projects in operation and under construction, and an additional 7 power projects in advanced development. ACWA Power has tapped into the Middle East’s growing demand for energy and the shift to generate cleaner energy.
The latest round of investment also comes as ACWA Power looks to issue an IPO to fund its plans to establish power projects across the Middle East and North Africa. As part of its expansion, the company recently opened a $170 million wind farm in Morocco in partnership with ARIF Investment Fund.
In an interview with Bloomberg earlier this year, ACWA Power CEO Paddy Padmanathan indicated that the company needs cash worth $800 million a year to fund its large power generation projects. He has said that ACWA Power plans to raise the funds through either the IPO or through partners acquiring an equity stake in projects.
With a portfolio of power projects spanning the region, ACWA Power counts major companies and international organizations such as ACWA Holding, Al Rajhi Holding, International Finance Corporation and Saudi Public Pension Agency among its investors.