The board of SET-listed electricity distributor Superblock Plc (SUPER) has approved the acquisition of the solar energy business of SPP Six Co.
The move will increase Superblock's power generation capacity to 515 megawatts by year-end and eventually raise company revenue.
Chairman Jormsup Lochaya said Superblock would proceed with the acquisition through its subsidiary Super Energy Group.
Super Energy will buy 49% of SPP Six, which operates a solar energy project with generating capacity of 41 MW, for 2.9 billion baht.
The acquisition is expected to help increase the company's power purchase agreement (PPA) to 515 MW by year-end from 474 MW now.
"After signing new PPAs as planned, the company will gradually start commercial operation dates to cover 515 MW by year-end, surpassing our target of 500 MW," Mr Jormsup said.
Prior to the acquisition, the SET had warned Superblock shareholders about a plan to acquire two solar farm projects worth a combined 14.4 billion baht, saying the acquisition prices were higher than fair market value.
The SET said in a release the analysis of an independent financial adviser expressed concern over two acquisitions -- Power Technology International Ltd and Energy Serve Ltd -- in which Superblock planned to acquire 49% and 51% stakes, respectively.
The SET warning noted the adviser believed the company would have to bear higher debt and interest burdens from the acquisitions, raising the risk Superblock would be unable to develop all the solar farm projects by December 2015.
The warning did not mention the SPP Six deal.
Superblock posted a third-quarter net loss of 137 million baht, deepening from a loss of 39.4 million in the same period last year, due to of rising operating costs.
Third-quarter operating costs rose substantially to 154 million baht from 46.9 million in the same period last year.
The increase was due to the company trying to expand its business by spending a large amount on renewable energy including solar farms, wind farms and biomass projects.
The company posted a nine-month net loss of 346 million baht, a year-on-year drop from 59.9 million.
SUPER shares closed yesterday on the SET at 1.38 baht, down one satang, in trade worth 50.7 million baht.
