Thailand: Utilities and Power subsidiary of WHA poised for IPO this quarter

Thailand: Utilities and Power subsidiary of WHA poised for IPO this quarter

WHA Utilities and Power Plc (WHAUP), which is scheduled to launch its
initial public offering in the first quarter, is "appealing" because of its
many unique qualities, its executives and financial adviser said.

"The customer base is very clear. They are situated in industrial estates,
most of them heavy industries that consume a lot of water and electricity,"
Veena Lertnimitr, executive vice president for primary distribution at Siam
Commercial Bank, the financial adviser to WHAUP, said yesterday.

The stock will be the only one of a company that engages in both the water
and electricity businesses, |she said. The subsidiary of WHA Corporation
Plc, a leading logistics and industrial estates developer, revealed at a
first press conference that the Securities and Exchange Commission had
approved its application for the IPO of up to 229.5 million shares, or 30
per cent of its paid-up capital.

Besides SCB, the firm is considering CLSA (Thailand) as its underwriter for
foreign institutional investors.

Veena said WHAUP could gain "synergy" from the WHA Group, including
providing utility, wastewater management and waste-to-energy services to the
group's expanding industrial parks.

"The firm has a strong partnership in the power business, which has already
been proven," she said.

WHAUP's equity partners in power-generation projects in Thailand and Laos
are Gulf Group, Glow Group, B Grim Power and Gunkul.

Jareeporn Jarukornsakul, chief executive officer of WHA Group, said WHAUP
was among a handful of companies that have both a "growth story" and
recurring income.

"This 2-in-1 quality is hard to find in any company. Last year, it had
revenue of more than Bt2 billion with profits of over Bt1 billion," she
said.

Somyos Anantaprayoon, chairman of WHA and WHAUP, said that from its
committed power projects alone, WHAUP would grow 15 per cent annually until
2019.

The firm is constructing power plants with a combined capacity of 760MW, of
which its equity share will be 190.07MW, which will be added to its current
equity megawatt capacity of 349.55MW.

The planned IPO comprises 125 million new shares and 104.5 million shares
held by H-International (SG).

The allotment will include a pre-emptive rights offering to WHA
shareholders.

The IPO proceeds will be used to finance the firm's utilities and power
businesses, supplement working capital and repay loans to financial
institutions.

Its debt-to-equity ratio will be cut from the current 1.3 times.

Wisate Chungwatana, CEO of WHAUP, said the firm plans to expand its utility
business to cover more products and industries as well as to enlarge its
customer base to industrial and municipal customers outside industrial
zones.

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John Diecker
APT Consulting Group Co., Ltd.

www.aptthailand.com