Riyadh-based Acwa Power has signed a US$693 million share purchase agreement with the regional subsidiary of French utility developer Engie to acquire assets in Kuwait and Bahrain.

Goldman Sachs Saudi Arabia acted as the sole financial adviser to Acwa Power, while King & Spalding served as the legal adviser.

This transaction will mark Engie's exit from the two countries. The company says the decision is part of its roadmap to achieving net zero by 2045.

The strategic acquisition encompasses operating capacities of 4.61 gigawatts of gas-fired power generation and 1.11 million cubic metres per day ( m3/day ) of water desalination facilities.

In Kuwait, Engie will divest its 17.5% shareholding in Az Zour North, a 1.5GW gas and desalination plant capable of producing 107 million imperial gallons of water daily ( MIGD ). It will also sell its 50% stake in Az Zour North Operations and Maintenance ( O&M ) Company.

In Bahrain, the divested assets comprise a 45% stake in Al Dur ( with 1.2GW capacity and 48 MIGD ), a 45% share in Al Ezzel ( 0.9GW capacity ), and a 30% stake in Al Hidd ( 0.9GW capacity and 90 MIGD ). Also being sold is a portfolio of companies responsible for the operation and maintenance of the four assets – 50% of Az Zour North O&M Company and 100% of Al Ezzel O&M Company.

The completion of the transaction is subject to customary regulatory approvals and closing conditions.

Still committed to GCC

Engie has been a significant player in the Gulf Cooperation Council ( GCC ) region, providing gas-fired power, desalinated water production, district cooling, hydrogen, and battery storage for more than 30 years.

Engie says it remains committed to the region, and will continue to invest in renewable energy projects, flexible generation, and innovative low-carbon solutions.

"This acquisition represents a pivotal milestone for Acwa Power, reinforcing our position as global leader in water desalination," says Marco Arcelli, the company’s chief executive officer. "We consolidate our presence in Bahrain where we are already a reliable supplier of power and water, and we enter Kuwait, where we recently submitted a bid for a large power and desalination plant. Reinforcing our presence in each country will allow us to further develop our people there and localize our operations more, providing safe and reliable supplies to the local communities and industries."

Thomas Brostrom, chief investment officer of Acwa Power, adds: "By making its inaugural entry into the Kuwaiti market through the acquisition of a stake in the Az-Zour North Facility, Acwa Power has achieved a significant milestone in its strategic efforts to expand its presence within the regional energy and water desalination sectors."

The secured contracted revenue streams from the acquired assets will reinforce Acwa Power’s broader strategy of tripling its assets under management to US$250 billion by 2030.

Largest wind farm in Egypt

Acwa Power also recently signed a 25-year power purchase agreement ( PPA ) with the Egyptian Electricity Transmission Company ( EETC ) for a 2GW wind project in Egypt.

Representing an investment of approximately US$2.3 billion, the project will become the largest wind farm in Egypt, surpassing Acwa Power's existing 1.1GW Suez Wind Farm.

It will also be the largest single-asset independent power producer ( IPP ) in the country, further solidifying the company’s position as the largest renewable energy developer in Egypt and Africa based on contracted projects, with a total investment of US$8.8 billion and a gross capacity of 4.8GW.

The 2GW wind project, which is targeted for financial close in 2026, will play an important role in supporting the Egyptian government in increasing renewable energy share in its electricity generation mix to 42% by 2030. Moreover, the project is expected to reduce carbon dioxide emissions by more than 3.5 million tonnes annually, contributing significantly to Egypt's climate change mitigation efforts.

Acwa Power has had a presence in Egypt since 2015 and currently has two other facilities in operation in the country – a 120-megawatt solar PV project in Benban and a 200MW solar PV facility in Kom Ombo.