RusHydro: energy ministry proposes reducing size of additional share issue
Russia’s Ministry of Energy proposes to reduce the size of the additional share issue of RusHydro, the state-controlled Russian hydropower company, reported Vedomosti.
The Russian daily cited Vyacheslav Kravchenko, Deputy Minister of Energy, as saying that the parameters of the additional share issue of RusHydro could be seriously reviewed.
The parametres of the additional share issue were determined last year, and its main objective is the repayment of debt of RusHydro’s subsidiary RAO Energy Systems of East, the article reported.
It has been assumed that RusHydro will conduct an additional share issue for RUB 154.7bn (USD 2.27bn). The paper reported that for its shares, RusHydro was expected to get the government’s shares in Far Eastern Energy Company and a 99.99% stake in state-owned Far Eastern Energy Management Company. RAO Energy Systems of East currently owns a 51.03% stake in Far Eastern Energy Company.
The paper reported that further 20% of RusHydro’s shares were to be acquired by state-run lender VTB, which was to sell them back to RusHydro in five years.
However, in mid-February, Russia’s Deputy Prime Minister Yuri Trutnev announced that property assets may be excluded from the transaction, Vedomosti reported.
The parametres of the deal with VTB may be also reviewed, as thanks to the optimization of RusHydro’s investment program, the amount of payment could be reduced, the paper noted, quoting Kravchenko.
According to a RusHydro spokesperson, the company is not inclined to link the sum planned to be received for the new shares with the change in the parameters of financing the investment programme, adding that the payment has been agreed by the government . The paper also reported that RusHydro’s investment program will be reduced by RUB 22bn this year, and that the final details will be disclosed later.
The article continued, citing Kravchenko, that various options to provide support to RAO Energy Systems of East are being considered, including the optimization of the investment program of parent company, and proceeds from the liberalization of the hydroelectric power market in Siberia.
Vedomosti