PV Power may raise $600 million from IPO, key investors

PetroVietnam Power Corp., Vietnam’s second-largest power producer, said the sale of a 49 percent stake to strategic investors and through an initial public offering could fetch about $600 million.

PV Power, as it is better known, is open to selling as much as 60 percent of the company, contingent on government approval, according to a document posted on its website. The IPO and stake sale to one or two strategic investors are expected to occur simultaneously in late August, President and Chief Executive Officer Nguyen Xuan Hoa said at his Hanoi headquarters. PV Power, a wholly-owned unit of Vietnam Oil and Gas Group, may spread the sale of additional shares over three years, he said.

The company has met with potential investors, including Singapore’s Sembcorp Industries Ltd. and GIC Pte, as well as Vietnamese investment funds Indochina Capital Corp., VinaCapital Investment Management Ltd. and Dragon Capital, according to the document.

BNP Paribas SA and Standard Chartered Plc are also representing undisclosed investors, the document said. Investment funds and power producers from Japan, South Korea, U.S. and Middle East have also expressed interest, Hoa said.

“Six months ago, we didn’t actively approach the market,” he said in the interview. “The market approached us with around 10 investors.”

PV Power, which expects to complete its corporate valuation this month, will hold more roadshows in April and May. He expects to have a short-list of potential strategic investors next month or June, and PV Power will choose one or two strategic investors, he added.

Vietnam’s electricity consumption is forecast to almost double to 271.4 terawatt-hours in 2026 from an estimated 144.4 terawatt-hours last year, according to BMI Research. “Vietnam is a clear outperformer in terms of power consumption growth when compared with the rest of Asia,” said Georgina Hayden, BMI head of power and renewables.

PV Power, which derives more than 90 percent of its revenue from power generation, is targeting to raise its power generation capacity by 153 percent through 2026 to 10,650 megawatts, mostly from gas-fired electricity, according to the website document.

The company aims to produce 20 percent of Vietnam’s power generation in 2026-27 from 15 percent now, Hoa said.

“We are about to be a key player in gas-fired power plant production as liquefied natural gas is the future of energy for Vietnam,” he said. “This is an exciting time for the country’s power industry.”

The company hired Maybank Kim Eng Holdings and PetroVietnam Securities Inc. as consultants, according to the document. PV Power plans a listing on the Ho Chi Minh City or Hanoi stock exchanges this year after the IPO, Hoa said.

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