China General Nuclear Power Corporation says it will set up its Southeast Asian headquarters in Kuala Lumpur. The move comes after the world’s largest clean-energy company formally purchased the power generation division of the troubled Malaysian state investment firm, 1MDB. The 2.5 billion dollar deal puts CGN – and China – at the top of the list of foreign investors in Malaysia. 

With the 2.5 billion dollar deal finally sealed, it was time to mark a new beginning after China General Nuclear’s purchase of Edra, the power generation division that accounts for 14 per cent of Malaysia’s total power generation capacity.

With the 2.5 billion dollar deal finally sealed, it was time to mark a new beginning after China General Nuclear’s purchase of Edra, the power generation division that accounts for 14 per cent of Malaysia’s total power generation capacity.

"It is our hope as the government of Malaysia that the country will be able to tap the huge expertise and experience of CGN, in particular in the areas of other sources of energy, such as solar and also hydro." Jphari Abdul Ghani, Deputy Finance Minister of Malaysia said.

The deputy minister acknowledged that 1 Malaysia Development Berhad, or 1MDB, had no choice but to sell its power assets to bring down its enormous debts. But the bidding to buy Edra was intense and competitive, ensuring a fair price. CGN also announced that they would be setting up their Southeast Asian regional headquarters in Malaysia.

"The assets of Edra are of high quality and its projects are operating well. Its projects are in five Belt and Road countries with considerable scale. Those projects have additional potential for development." Zhang Shanming, President of China General Nuclear Power Corporation said.

Given Edra’s overseas holdings, CGN now becomes the biggest independent power producer in both Egypt and Bangladesh. The CGN deal comes on the heels of another enormous Chinese investment.

China Railway Group agreed late last year to spend roughly $2 billion to buy a majority stake in an iconic urban development called Bandar Malaysia, also from 1MDB. Plans are underway, meanwhile, for CGN to construct two more gas-fired power plants in the Malaysian state of Melaka.

The Edra deal was the first time Malaysia has allowed a foreign company to take 100 per cent ownership of a major producer another sure sign of the increasingly close ties between Malaysia and China.