KUALA LUMPUR (Jan 7): Coastal Contracts Bhd (KL:COASTAL) said it has formed a 60%-owned subsidiary, Coastal Watt Energy Pte Ltd (CWE), as part of a strategic collaboration to expand into renewable energy projects in the Asia-Pacific region.

Coastal said CWE was established by its wholly owned unit Coastal Drilling Pte Ltd (CDPL) on Monday, Jan 6, with a paid-up capital of S$100,000 (RM329,674).

The unit will operate alongside Hongkong Watt Energy Tec Co Ltd (HWET), which will hold the remaining 40% stake in CWE.

CWE is tasked with providing technical and project management services, as well as investing in renewable energy projects in accordance with a defined business plan.

Its board of directors comprises five members, with three nominated by CDPL and two by HWET.

While the collaboration is not expected to materially impact Coastal’s financials for the financial year ending Dec 31, 2025 (FY2025), it said successful project acquisitions could positively contribute to its future earnings and net assets.

Coastal clarified that the arrangement does not require shareholder or regulatory approvals, and no directors or major shareholders have any direct or indirect interests in the collaboration.

It said that the partnership aligns with Coastal’s strategic goals and represents a significant step in diversifying into the renewable energy sector.

Shares of Coastal were up one sen, or 0.7%, to RM1.54 at the market close on Tuesday, giving the group a market capitalisation of RM846.82 million. The stock has fallen 6.67% since Jan 2, 2024.