The Hanoitimes - PetroVietnam Power (PV Power) plans to offer 468.3 million shares of its chartered capital in an initial public offering (IPO) on January 31, that aims to raise at least VND 6.74 trillion (US$296 million), stated in its official website.
That said, the number of shares equivalent to 20% of PV Power’s chartered capital will be listed in the Hanoi Stock Exchange with an initial price of VND 14,329 per share (US$ 0.64), indicating the chartered capital at VND 23 trillion (US$ 1.04 billion).
PV Power is currently the second largest electricity producer in Vietnam after Electricity of Vietnam (EVN) in terms of capacity, thus, its IPO is expected to attract interests from international investors. PV Power will host two roadshows to introduce investment opportunity to potential investors on January 16 in Hanoi and another on January 19 in Ho Chi Minh.
PV Power is currently the second largest electricity producer in Vietnam.
At the roadshow, PV Power will provide essential information and answer questions with regard to the equitization process of PV Power. After completing the IPO, PV Power will continue selling 676 million shares to strategic investors, or equivalent to 29% of its chartered capital.
Strategic investors have to record positive after-tax profit in the two recent consecutive years and no accumulated loss, while they also have to commit not to transfer shares in 5-year period.
PV Power is working with Vinacapital, BNP Paribas, Standard Chartered Bank on the process of equitization and in search of strategic investors. A workshop held by PV Power in collaboration with JP Morgan as an introduction to PV Power and opportunity to become strategic investor to PV Power had attracted global leading investment funds such as: Artisan Partners Maria Negrete-Gruson (US), Cartica Capital (US), Franklin Advisors (US), Franklin Templeton (US), Greenwoods Asset Management Ltd (Hong Kong), Invesco Global (US), Jennison Associates, LLC (US), Morgan Stanley (US).
After the completion of equitization process, Petro Vietnam (PVN) will hold 51% chartered capital of PV Power, for which this rate could be gradually reduced since 2019, depending on the restructuring process.
PV Power has 12% in the electricity market, while EVN dominate the market with 61%. The PetroVietnam’s power generation arm expects to grab a slice of 20 per cent of this industry as Vietnam is forecast to pose the highest annual growth rate of electricity consumption among Southeast Asian countries by 2025, potentially hitting 272 TWh. In 2016, total electricity production of PV Power reached 21.131 billion kWh, with consolidated revenue of VND28 trillion (US$ 1.2 billion), posting after-tax profit of VND 1.5 trillion (US$ 66 million). In 2017, PV Power’s production of electricity has slightly decreased to 20.58 billion kWh; but the consolidated revenue has increased to nearly VND 31 trillion (US$ 1.37 billion) and recorded after-tax profit of VND2.3 trillion (US$ 102 million).