November 11, 2008

Statkraft to Purchase 10% of Norfund Stake in SN Power

Norwegian electricity generation company SN Power's owners Statkraft and Norfund have reached an agreement, pursuant to which, Statkraft will purchase 10% of Norfund's shares in SN Power for NOK1.1 billion.

Following the purchase, Statkraft will become the majority owner in SN Power, with a 60% share, while Norfund's share is reduced to 40%. In parallel, Statkraft and Norfund have agreed to establish a separate company which will focus on hydropower development in Africa and Central America.

SN Power will take a majority position, a 51% stake, in the new Africa-Central America entity. The remaining 49% of shares in the company will be held by Norfund. Other Norwegian regional power companies will be invited into the entity as investors by Norfund which intends to eventually dilute its ownership in the new company.

Under the agreement, Statkraft also has the right to exercise a 7% call option at the latest by 2015 and increase their ownership stake to 67%. As per the agreement, Norfund also has the right to exercise a put option for its remaining 40% within the same timeframe or sell out up to 20% of its remaining shares in SN Power to a third investor by 2010.

Bard Mikkelsen, Statkraft's CEO, said: "The increased shareholding in SN Power supports Statkraft's ambition to develop its role as a global niche player within hydropower and other renewables. SN Power's market positions in Asia and South America gives a strong starting point for long-term, global positioning."