Friday, August 9, 2013

Upper Tamakoshi hydro applies to Sebon for Rs 5.18 billion primary issue

Though, the much awaited Upper Tamakoshi Hydropower project has been redesigning its tunnel due to geographical trouble that is going to delay power generation for at least six months, it has geared up for the public offering.
As it has completed 50 per cent of the construction work, the Upper Tamakoshi Hydropower has last week applied to the capital market regulator, Securities Board of Nepal (Sebon), for Initial Public Offering (IPO), according to acting chief of the power project Bigyan Shrestha.
The company has appointed Citizen Investment Trust (CIT) as the issue and sales manager for the issuing of Rs 5.18 billion worth IPO that will be the largest public offerings till date.
“In the first phase, Upper Tamakoshi Hydropower is floating shares to the employees of its lenders like Employees’ Provident Fund (EPF) and its members, employees of hydropower, Nepal Electricity Authority (NEA), Nepal Telecom (NT), Citizen Investment Trust (CIT) and Rastriya Beema Sansthan (RBS),” he said, adding that the Dolakha-based 456-Mega Watt (MW) hydel project has a paid-up capital of Rs 10.59 billion. “They will be floated some 24 per cent of the share in the first phase.”
Immediately after the first phase, some 10 per cent share will be issued to Dolakha locals in the second phase.
The Employment Provident Fund employees might get around 2,542 units of shares per employee, whereas some 2,74,492-unit shares has been allotted for Rastriya Beema Sansthan employees, Nepal Electricity Authority and Upper Tamakoshi employees some 40,66,560 unit, and Nepal Telecom employees have been allotted some 8,23,478 unit shares, according to the shares of the institutions.
In the third and last phase, the project will float 15 per cent shares for the general public, making it a total of 49 per cent.
The institutional investors will hold the remaining 51 per cent of the shares. Of the 51 per cent, Nepal Electricity Authority is holding 41 per cent, Employment Provident Fund 10 per cent share and two per cent debenture, Nepal Telecom six per cent, and Citizen Investment Trust and Rastriya Beema Sansthan is holding two per cent share each of the Rs 35.29 billion-hydel project. The institutional investors have already paid Rs 5.10 billion of the total Rs 22 billion what they have pledged for. The government is investing Rs 11.08 billion in the project that is expected to be completed by 2014-15, though the recent tunnel problem will delay it by six months to one year.
Accoring to the capital market regulator, it will approve the hydel project’s public offering after the review.

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