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The High Price of Russian Electricity
The biggest deal for RAO UES of Russia yet took place yesterday when the Finnish Fortum concern acquired the state share package in TGK-10 at $767 per kilowatt of capacity. RAO expects that record to be broken in its spring sale of other assets, although experts are less convinced. They do agree that the Fortum purchase will raise the stakes on future sales. Fortum won the auction for 55.29 percent of TGK-10 and will pay 111.80 rubles ($4.62) per share of the territorial generator.
TGK-10 operates in Tyumen and Chelyabinsk Regions and Khanty-Mansi Autonomous Area. It is made up of Tyumen thermoelectric plants 1 and 2, the Tobol thermoelectric plant, Chelyabinsk thermoelectric plants 1, 2 and 3, the Argayash thermoelectric plant and the Chelyabinsk hydroelectric plant. They have a total capacity of 2,773,000 kilowatts. In investment program will nearly double that capacity by 2012.
Fortum paid 18 percent over the market price of TGK-10 shares as of the evening of February 27. The price of a share gained 9.15 percent yesterday, rising to 103 rubles (about $4.25) on MICEX. RAO will receive 28.6 billion rubles (more than $1.18 billion) for the package. Fortum also expressed interest in buying an additional stock issue by the company in a volume sufficient to attract 4.6. billion rubles, which will give Fortum a 75-percent share in the company. That deal is to be approved by the company board today.
www.kommersant.com
All the Article in Russian as of Feb. 29, 2008
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