State-owned China Three Gorges Corp. is nearing a deal to acquire Dubai-based wind and solar developer Alcazar Energy Partners, people with knowledge of the matter said, in one of China’s biggest pushes yet into Middle Eastern renewable energy.
A consortium led by Three Gorges is in advanced talks to buy Alcazar Energy for about $500 million, the people said, asking not to be identified because the information is private. An announcement could come as soon as the next few days, according to the people.
The deal could serve as a springboard for China to increase clean energy investments in the Middle East. Chinese companies have put their money into oil and gas in the likes of Iraq and the United Arab Emirates for years, but have only recently taken an interest in renewables in the region.
Including debt, a deal could value Alcazar at about $1 billion, Bloomberg News has reported. The company has been working with Standard Chartered Plc to consider options including a potential sale, people with knowledge of the matter said earlier.
Deliberations are ongoing, and talks could still drag on or fall apart, the people said. A representative for Alcazar declined to comment, while a spokesperson for Three Gorges didn’t immediately respond to requests for comment.
Several Middle Eastern governments, including the major oil producers in the Persian Gulf, are trying to cut the use of fossil fuels in their power grids. Founded in 2014, Alcazar has projects in Egypt and Jordan with a total generation capacity of around 410 megawatts. Its investors include a fund linked to Abu Dhabi’s Mubadala Investment Co., Dubai-based Blu Stone Management Ltd. and the World Bank’s International Finance Corp.
China Three Gorges listed its renewable energy subsidiary earlier this year in Shanghai, raising about 22.7 billion yuan ($3.5 billion). It has been acquiring foreign assets for more than a decade. Since early 2020, it’s invested roughly 1 billion euros ($1.2 billion) in Spanish solar projects.
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