By Somluck Srimale
CK Power has set its initial public offering price at Bt13 per share, expecting to raise Bt2.86 billion, enough to finance its expansion plans, a company executive said.
The price presents a 26-per-cent discount from book value of other companies in the same sector but is 27 per cent above its own Bt10.20 book value.
The price is set below an earlier estimate, as the share-sale period coincides with a huge slump in the local stock market.
CK Power will be the first holding company with interests overseas to seek a listing on the Stock Exchange of Thailand.
At this price, the company will raise only Bt2.86 billion from its IPO of 220 million shares, of which 180 million is new capital, and the rest existing shareholders. Subscription will open from tomorrow to Saturday and trading on the SET will begin on July 18.
This is lower than the company’s earlier estimate, but it believes it is enough for business expansion this year, managing director Dr Supamas Trivisvavet said.
She added that Bt1.3 billion of the total would be used to pay back loans, and the rest for its operation and investment plans.
Dr Kongkiat Opaswongkarn, chief executive officer of Asia Plus Securities, the lead underwriter for CK Power, said 40 per cent of the IPO would be allotted to the company’s related parties, 20 per cent to institutional investors, and the remainder to other investors.
“We based the price on demand, and also need to benefit all parties,” he said.
CK Power holds major stakes in five power firms. They are: a hydropower plant of Southeast Asia Energy Co in Laos, three solar power plants in Thailand – Bangkhenchai Co, Nakhon Ratchasima Solar Co, and Chiangrai Solar Co – and the latest one, Bangpa-in Cogeneration Co.
The company has long-term plans to invest more than Bt10 billion to increase its generation capacity from 874.5 megawatts now to 4,380MW in the next 10 years.
Supamas said CK Power’s investment plan would support the country’s increasing demand for electricity, expected to rise from 26,455MW last year to 54,256MW by 2030.
“We are interested in developing power plants using both alternative and traditional energy. That will depend on the business opportunity,” she said.
Overseas, the company is focused on Laos. It is also studying business opportunities in Myanmar.