The 456-mega watt Upper Tamakoshi Hydropower, which is under construction, appointed Citizen Investment Trust (CIT) today as its issue and sales manager to float shares within the current fiscal year.
"The hydropower project reported 40 per cent development by mid-January," according to the company that has aimed to start power generation by mid-May 2015, though the complete generation of 456 MW will start from mid-March 2016.
The company is planning to issue shares within the current fiscal year 2012-13, in two phases. "In the first phase, the company will float shares worth Rs 3.60 billion to locals of Dolakha district — where the hydropower is based — and Nepal Electricity Authority (NEA), besides employees of lender agencies like Nepal Telecom (NT), Employees Provident Fund (EPF), Rastriya Beema Sansthan and CIT," the company said, adding that in the second phase, the company will float shares worth Rs 1.58 billion to the general public.
The hydropower project that is estimated to cost Rs 35.29 billion is being constructed with domestic capital — 70 per cent in loans and 30 per cent shares — from institutional shareholders and the general public.
Nepal Telecom has lent Rs 6 billion, Rastriya Beema Sansthan and Citizen Investment Trust lent Rs 2 billion each, Employees Provident Fund lent Rs 10 billion and invested Rs 2 billion as debenture, and the government lent the remaining Rs 11.8 billion.
Earlier, it had established a company with Rs 10 billion authorised capital and Rs nine billion issued capital for the 30 per cent share capital. However, it recently changed the capital structure with Rs 11 billion authorised capital and Rs 10.59 billion issued capital.
According to the new capital structure, NEA will have 41 per cent, Nepal Telecom six per cent, Rastriya Beema Sansthan and CIT two per cent each, provident fund holder staff of Employees Provident Fund 17.28 per cent, locals of Dolakha 10 per cent, public 15 per cent, employees of lender institutions 2.88 per cent and Upper Tamakoshi Hydropower and NEA employees 3.84 per cent.
Likewise, the hydropower has already received Rs 5.10 billion from institutional shareholders like NEA, Rastriya Beema Sansthan and CIT, out of the Rs 5.40 billion they have committed and the remaining Rs 300 million will be made available before the company floats the shares.
Citizen Investment Trust will now send the prospectus to Securities Board of Nepal (SEBON) for the approval to float shares.