Private Placement Result
Within the period between January 17 and May 17 2011, INTER RAO UES issued 13.8 trillion additional shares. This additional share issue was part of INTER RAO UES’ corporate strategy aimed at creating a diversified energy holding company, which would become one of the world’s ten largest energy companies.
The major participants in the current issue of additional shares, which was held by closed subscription, were the following entities:
- The Federal Agency for State Property Management on behalf of the Russian Federation
- State-owned and state-controlled energy companies
- Private investors
As a result of the additional issue, the shares of c.40 companies operating in electricity power generation, electricity distribution and supply, manufacturing of power equipment and engineering were transferred to the balance of INTER RAO UES.
State-owned stakes in electric utilities companies were transferred to INTER RAO UES’ authorized capital in accordance with Presidential Decree ¹ 1190 dated 30.09.2010 and the Order of the Russian Federation Government ¹ 1837 dated 23.10.2010.
The offering price of one common share for the purposes of INTER RAO UES’ additional issue was set on the basis of the valuation conducted by a consortium of appraisers, including Deloitte & Touche CIS, the Institute for Enterprise Issues and Nexia Pacioli Consulting. The price was fixed at 5.35 kopeks.
Main stages of the additional issue
| Timetable | Date |
|---|---|
| Approval of an additional share issue by the Annual General Meeting of Shareholders of RAO UES | 25.06.2010 |
| Approval of the share offer price and market value of the consolidated share by the Board of Directors of INTER RAO UES | 27.12.2010 |
| Start of additional share issue | 17.01.2011 |
| Placement of additional issue to persons who have priority right to acquire shares begins | 17.01.2011 |
| Approval of related party transactions in the placement of additional issue by EGM | 21.02.2011 |
| Expiry of the pre-emptive right to purchase shares in INTER RAO UES | 03.03.2011 |
| Start of placement of additional issue to private subscription participants | 11.03.2011 |
| Completion of additional share issuance | 17.05.2011 |
| A state registration report on the additional issue | Èþíü 2011 |
Assets within the consolidation perimeter
| Assets under consolidation | Share in authorized capital,%
|
|---|---|
| Generating assets |
|
| Razdanskaya TPP (Armenia) | 100% |
| OGK-1 | 75.02% |
| OGK-3 | 81.93% |
| TGC-11 | 67.53% |
| Irkutskenergo | 40.01% |
| TGK-7 (Volzhskaya TGK) | 32.44% |
| Enel OGK-5 | 26.43% |
| Kuban Generation Company | 26.26% |
| TGK-6 | 26.08% |
| Bashkirenergo | 22.23% |
| Sangtudinskaya HPP-1 | 16.66% |
| OGK-6 | 13.2% |
| Mosenergo | 5.05% |
| RAO Energy System of East | 4.29% |
| OGK-4 | 3.26% |
| OGK-2 | 3.05% |
| Fortum (TGK-10) | 3.04% |
| Quadra (TGK-4) | 2.25% |
| Eniseyskaya TGK | 2.16% |
| TGK-1 | 1.97% |
| Kuzbassenergo (TGK-12) | 1.97% |
| TGK-9 | 1.71% |
| RusHydro | 1.63% |
| TGK-2 | 1.19% |
| TGK-14 | 0.6% |
| Novosibirskenergo | 0.18% |
| Grid Assets | |
| FGC UES | 0.37% |
| Supply assets | |
| RN-Energo ** | 100% |
| Altayenergosbyt | 100% |
| St.Petersburg Supply Company | 88.28% |
| Tambovenergosbyt | 59.38% |
| Saratovenergo | 56.97% |
| Mosenergosbyt | 50.92% |
| Tomsk Energy Retail Company | 31.27% |
| Kuban Energy Retail Company | 26.26% |
| Engineering | |
| Tomskenergoremont | 25.88% |
| Management Companies | |
| United Energy Retail Company | 100% |
| Other assets | |
| TGK-11 Holding | 34.34% |
* - including stakes, which were owned by INTER RAO UES before the additional share issue.
** - willbeacquiredafterMay 17 2011
As part of the additional share issue placement INTER RAO UES acquired various-sized stakes in energy companies. In accordance with the strategy of INTER RAO UES, the principles of management and use of these assets are as follows and depend on a stake size.
Assets obtained under the additional issue are divided into 3 groups:
1) Minority stakes (<10%) will be used in asset swaps or monetized to raise financing.
2) Sizable stakes (10-50%). Decision on the use of these stakes will be taken following the development prospects of a particular asset and opportunities to deliver synergies within the holding. For example, such stakes might be increased to controlling ones or used in M&A deals or in asset swaps.
3) Controlling stake (>50%). Assets, where INTER RAO UES has a controlling stake, are expected to be integrated into the company’s business model.
