The United Arab Emirates (UAE) state-owned corporation TAQA (Abu Dhabi National Energy Company PJSC) is increasingly likely to acquire GS Engineering and Construction's water treatment subsidiary GS Inima. TAQA, which is 75.1% owned by the UAE government, is headquartered in Abu Dhabi and operates in 11 countries across four continents. It is listed and traded on the Abu Dhabi Securities Exchange.
There are suggestions that TAQA may offer a price significantly exceeding GS Engineering and Construction's desired sale price of $1.4 billion (approximately 2 trillion won). It has been reported that TAQA is currently conducting due diligence on GS Inima's overseas subsidiaries.
According to investment banking (IB) industry sources on the 24th, TAQA is in the final stages of due diligence on GS Engineering and Construction's Spanish water treatment subsidiary GS Inima for the acquisition. An industry insider noted, "Due diligence on GS Inima's overseas subsidiaries is currently underway." However, it has not yet been determined whether GS Engineering and Construction will sell its entire equity or a portion of it.
GS Inima is a Spanish water treatment company acquired by GS Engineering and Construction in 2012, specializing in the top 10 global desalination plants and water treatment. It was purchased from its parent company OHL (Obrascon Huarte Lain), which was struggling financially at the time. Yoo Hyun-hong, CEO of GS Engineering and Construction, incorporated the company as a wholly-owned subsidiary (100% equity) in 2019, and attempted to list it on the KOSPI in 2022, but it was unsuccessful. The estimated corporate value at the time of the listing attempt was around 1.5 trillion won. As of the end of the third quarter of last year, GS Inima's cumulative revenue was 402.325 billion won, with an operating profit of 37.981 billion won.
GS Engineering and Construction decided to sell GS Inima to seek new business opportunities using the proceeds from the equity sale, initiating the sale process in 2023.
Spanish daily Expansion reported that TAQA has entered the acquisition race for GS Inima. The acquisition amount proposed by TAQA is said to be at least 1 billion euros (approximately 1.5 trillion won). There are also mentions of a potential offer exceeding 2 trillion won.
TAQA, a UAE state-owned energy company established in 2005, develops, operates, and invests in domestic and international energy and water resources. It has set a goal through its 2030 strategic plan to expand its clean energy-based power generation to over 30% by 2030.
Middle Eastern economic media MEED (formerly Middle East Economic Digest) reported last December that Abu Dhabi state-owned energy company TAQA is expected to submit a proposal to acquire GS Inima, a desalination development and investment company based in Madrid, from its parent company, South Korea's GS Engineering and Construction, by February.
TAQA is currently listed on the Abu Dhabi Securities Exchange, with a market capitalization of approximately 120 trillion to 130 trillion won. It was established in 2005 following the privatization of the Abu Dhabi power and water sectors in 1998, and operates in over 10 countries in power, water supply, and oil and gas businesses. Although the water treatment segment accounts for 4.4% of TAQA's revenue, it represents 7.3% based on earnings before interest, taxes, depreciation, and amortization (EBITDA). With GS Inima based in Spain also engaged in water treatment, desalination, and renewable energy operations in Brazil and the Middle East, the acquisition of Inima is expected to play a significant role in expanding TAQA's water treatment division.