Thailand: Big investors switch on for B.Grimm IPO

Thailand: Big investors switch on for B.Grimm IPO

Three institutional investors have confirmed they will subscribe 201 million
initial public offering (IPO) shares of B.Grimm Power Plc, of which the
first day of trade is scheduled for July 19.

The investors are Asian Development Bank, Muang Thai Life Assurance and Thai
Life Insurance, said B.Grimm Power's chief executive Preeyanart
Soontornwata.

The company announced an indicative price range of 15 to 16.50 baht per
share for 651.8 million newly issued shares, with a greenshoe option not
exceeding 65.1 million shares.

Proceeds from the IPO sales are projected to be 10.8 billion baht, or 11.8
billion if the greenshoe option is fully exercised. The price will be
finalised on July 7.

Of the total 651.8 million IPO shares, 284 million shares or 55.5% will be
allocated to customers of nine underwriters and institutional investors,
with 201 million shares going to three cornerstone investors and the
remaining 166.8 million to foreign investors.

Ms Preeyanart said the funds raised would also go for loan repayment, which
should cut the debt-to-equity ratio to 1.5 to 2 times, down from 3.4 times
in the first quarter of 2017.

The company set a target to increase its power-generating capacity to 5,000
megawatts over the next few years, up from 2,357MW.

From this year to 2021, it expects at least 15 projects will be constructed
and start commercial operation, leading to rising revenue for the company as
more power purchase agreements are signed.

Major projects that would increase revenue over the next five years include
two hydropower plants in Laos with total capacity of 20MW that are due to
start commercial operation next month. The two plants are estimated to
generate revenue of 200 million baht a year, she said.

In 2018, an additional 414MW of power-generating capacity is expected, with
three cogeneration plants in Amata City Industrial Estate in Rayong
contributing 399MW, and a hydropower plant in Laos adding 15MW.

For 2019, five more hydropower plants in Laos with total installed capacity
of 68MW are due to come online, then two wind farms with capacity of 16MW
the next year. Three cogeneration plants in VRM Industrial Estate with
capacity of 240MW are also due in 2020.

The company is conducting feasibility studies about possible power
investments in Indonesia, Myanmar, Malaysia, Vietnam, Cambodia and the
Philippines, said Ms Preeyanart.

For long-term investment, Ms Preeyanart said B.Grimm recently signed a
memorandum of understanding to develop renewable power projects with China
Energy Engineering Corporation, particularly solar-hybrid power systems.

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Link to Original Article:
http://www.bangkokpost.com/business/news/1272495/big-investors-switch-on-for
-b-grimm-ipo

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John Diecker
APT Consulting Group Co., Ltd.

www.aptthailand.com