Singapore Exchange (SGX) today acquired the remaining 51% of Singapore-based Energy Market Company (EMC) from the Energy Market Authority (EMA), making EMC a wholly-owned subsidiary of SGX.
This acquisition will allow EMC to leverage SGX’s expertise and operational synergies to provide better services to market participants at more competitive rates. For a start, wholesale electricity market participants will benefit from two percent savings in market fees over the next three years.
It will also enable SGX, a leading operator of securities, commodities and derivatives markets, to integrate development with EMC’s platform for an electricity futures market and related power and gas products for Singapore.
“Asia’s continued growth and rising consumption translate to strong power and gas demand. SGX is already a hub for the trading and risk management of commodities and financial derivatives. Together with EMC, we intend to become Asia’s price discovery centre for power and gas,” said Magnus Böcker, CEO of SGX.
SGX is acquiring 51% of EMC for a cash consideration of $23 million. The change in EMC’s shareholding will have no impact on its operation of the wholesale electricity market. The acquisition is not expected to have any material impact on SGX’s net tangible assets and earnings for the financial year ending 30 June 2015. EMC will continue to be regulated by EMA. SGX had in August 2012 bought 49% of EMC, the operator of the National Electricity Market of Singapore (NEMS). NEMS is the first liberalised market in Asia for wholesale buying and selling of electricity.
