State Grid International Development Ltd (SGID), a wholly-owned subsidiary of State Grid Corporation of China, on Sunday signed agreements with Nama Holding to acquire a 49 per cent stake in Oman Electricity Transmission Company (OETC).

Nama Holding had launched the first phase of the privatisation programme in October 2018 by announcing the sale of up to 49 per cent of the shares held in OETC and up to 70 per cent of the shares held in the electricity distribution and supply companies. Eligible international entities were invited to participate in the process and submit expressions of interests (EOIs).

For OETC, Nama Holding received 11 EOIs from 16 international investors, either individually or in consortia. At the conclusion of the process for OETC, SGID, incorporated in Hong Kong, was declared the winning bidder, Nama Holding said in a press statement.

On Sunday, SGID and Nama Holding signed the agreements pertaining to the sale of 49 per cent shares of OETC, during a ceremony held in Muscat. The OETC transaction is conditional only upon the approval of the Authority for Electricity Regulation, and (subject to satisfaction of this condition) completion is expected to occur in early 2020, Nama Holding said.

H E Saud Nasser Rashid al Shukaili, chairman of the Privatisation Supervisory Committee, said, “Nama Holding is committed to implementing the privatisation programme of Oman’s electricity sector according to the set time-frame. We are delighted to announce the completion of the privatisation of OETC today with SGID, one of the largest operators of electricity transmission networks in the world with a total asset of US$41.2bn; with international operations covering Philippines, Portugal, Brazil, Australia, Hong Kong, Italy and Greece.”

For OETC’s privatisation, Lazard Frères acted as financial advisor, London Economics as economic advisor, Herbert Smith Freehills as international counsel, Al Busaidy, Mansoor Jamal & Co (AMJ) as local counsel, Zeenah PR as communications consultant, ESBI as technical consultant and EY as accounting and tax consultant to Nama Holding.

HSBC acted as financial advisor, Allen & Overy as international legal counsel, Addleshaw Goddard (AG) as local legal counsel, Deloitte as accounting and tax consultant, NERA Economic Consulting as market advisor and Ramboll as technical consultant to SGID.

Earlier in 2017, based on the Omani government’s directives, Nama Holding initiated the partial privatisation programme for the four electricity distribution and supply companies and OETC. These companies are wholly-owned by Nama Holding on behalf of the sultanate’s government.

Through this privatisation programme, Nama Holding will support the government’s objectives of attracting foreign direct investments (FDI) into the country and promoting private sector participation as part of the wider nation-building process. The objective is also to harness best-in-class technologies and technical and administrative expertise in these companies, which will result in human resource development, improved customer satisfaction and a more efficient resource utilisation. This will, in turn, translate into a more optimised economic cost per unit of electricity supplied over time.