Tata Power Says It Will Bid for Singapore's Senoko

By Archana Chaudhary

Aug. 6 (Bloomberg) -- Tata Power Ltd., India's biggest electricity generator outside state control, said it is bidding for Senoko Power Ltd., Singapore's largest power utility. The shares rose.

``We confirm the development,'' Mumbai-based Tata Power said in a statement today after the Business Standard reported that Senoko Power may be sold for more than $3 billion. The Indian company will get access to generation capacity of 3,300 megawatts should it win the bid, the report said.

The acquisition will be Tata Power's second large investment overseas. The utility spent $1.2 billion on buying two mines in Indonesia last year to secure coal supplies. Tata Power has invested 240 billion rupees ($5.7 billion) to build 5,600 megawatts of thermal and wind power capacity across India.

``There could be an advantage in terms of access to better technology and that comes from working in countries that are more advanced in distribution and transmission of power,'' said Mansingh Deshmukh, Mumbai-based analyst for MF Global Sify Securities Pvt. ``Tata Power may make this acquisition through a special purpose vehicle because this will be a pretty big investment.'' Deshmukh recommends investors buy Tata Power stock.

Tata Power shares rose 35.1 rupees, or 3.2 percent, to 1,137 rupees at 9:58 a.m. in Mumbai trading after rising as much as 5.2 percent.

Malaysia's YTL Power Bhd., France's GDF Suez, Japan's Mitsubishi Corp. and Marubeni Corp., and OneEnergy Ltd. jointly with Hong Kong's CLP Holdings are the other bidders shortlisted by Singapore's Temasek Holdings Pte to bid for Senoko, Reuters said yesterday, citing unnamed people in the banking industry.

The sale of Senoko Power, alongside Temasek's third utility PowerSeraya, will be completed by the end of 2009, Temasek said on July 7. Temasek is Singapore's state-owned investment company with assets worth more than $100 billion.

To contact the reporter on this story: Archana Chaudhary in Mumbai at achaudhary2@bloomberg.net.