The PetroVietnam Power Corporation (PV Power), a subsidiary of the Vietnam National Oil and Gas Group (PetroVietnam), will offer 20 percent of its shares in an initial public offering (IPO) on January 31. 

Ca Mau 1 power plant under the PetroVietnam Power Corporation. The company will offer 20 percent of its shares in an initial public offering (IPO) on January 31.

The sale is part of the PV Power equitisation plan approved by the Prime Minister on December 8, 2017, under which the State will reduce its stake in PV Power to 51 percent after PV Power becomes a joint-stock company, said PV Power Chairman Ho Cong Ky at a workshop in Hanoi on January 16. 

More than 676 million shares, equivalent to 28.88 percent of PV Power’s chartered capital, will be sold to strategic investors, while the remaining shares, equivalent to 0.11 percent of its chartered capital, will be sold to PV Power’s staff, he said.

PV Power prioritises strategic investors who are owners of oil and gas fields and coal mines as they can provide fuels for the corporation’s electricity plants for a long term, Ky stressed. 

PV Power General Director Nguyen Xuan Hoa said the priority enables strategic investors to gain over 36 percent of PV Power’s chartered capital and have the veto power in the council of shareholders.  

The State’s capital in PV Power may decrease to below 51 percent after 2019 when the corporation successfully concludes negotiations with international donors over the restructuring of loans for the Vung Ang 1 thermal power plant, he noted. 

Hoa said the equitisation of PV Power has attracted attention from hundreds of investors, including electricity development investors that are more powerful than PV Power in terms of finance, human resources and capacity. 

Owners of oil and gas fields and coal mines from Indonesia, Australia, Qatar and Saudi Arabia have also been interested in the corporation’s shares. 

Hoa informed the workshop that PV Power has to date selected 30 qualified domestic and foreign investors for cooperation over the next 5-10 years. 

According to Decree No. 126/2017/ND-CP, strategic investors are required to make profits in the last two years and hold on to PV Power shares for at least five years.

PV Power has given priority to strategic investors who can allocate capital for the corporation to implement an array of thermal power projects in the time ahead, as well as those who can improve its financial, personnel and technological management capacity and operate in electricity generation in order to, together with PV Power, ensure the supply of gas and coal for projects once domestic natural resources decrease. 

In this regard, Ky stressed that PV Power prioritises investors who promise to receive a number of coal-fueled power projects invested by PetroVietnam.

He explained that following the equitisation, these power projects can only be handed over to PV Power for operation and maintenance through the council of shareholders.

PV Power was established in 2007 and it was fully-owned by PetroVietnam. The company operates one coal-based thermal power plant, three gas-used thermal power plants, and three hydropower plants. The annual production is more than 4,208 megawatts — equal to 10 percent of the country’s total power output.-VNA