October 4, 2016 / 6:51 AM / a year ago

Thai TPI Polene to spin off, list power unit in November

BANGKOK, Oct 4 (Reuters) - TPI Polene Pcl, Thailand’s third-largest cement maker, plans to spin off its power business by selling a 30 percent stake to the public and listing shares on the Thai bourse in November, company executives said on Tuesday.

TPI Polene Power, the country’s largest producer of waste-derived power, plans to sell up to 2.5 billion shares, representing 29.8 percent of the company, in an initial public offering, Pakkapol Leopairat, chief financial officer of the power unit, told a news conference on Tuesday.

TPI Polene and TPI Polene Power declined to say how much money they expected to raise in the offering.

About 5 percent of the shares will be offered to TPI Polene’s existing shareholders at a ratio of 162 shares for one in the power company, Pakkapol said.

Proceeds from the sale will be used mainly to finance expansion of the power company’s capacity, he said.

TPI Polene Power also plans to use part of the proceeds to repay 4 billion baht in debt, to cut its debt to equity ratio to nearly zero from 0.55 times now.

TPI Polene Power made a first-half net profit of 1.1 billion-1.2 billion baht ($350 million-$400 million), the financial officer said.

It aimed to invest about 12 billion-14 billion baht during the second half of 2016 and over the whole of 2017 to nearly triple its power generating capacity to 440 megawatts (MW) by the end of next year, Pakkapol said.

TPI Polene Power runs four plants with a total installed capacity of 150 MW. Two of the plants, with a combined capacity of 80 MW, use fuel derived from refuse. The other two, with a total capacity of 70 MW, generate power from waste heat.

Prachai Leophairatana, chairman of the two companies, said the power unit was looking for opportunities to invest in solar, wind and other renewables in neighbouring Myanmar and Laos.

After the share sale, for which it has received approval from the Securities and Exchange Commission, TPI Polene’s holding in the power company will be 70 percent, it said.

Maybank Kim Eng Securities, Tisco Bank and CIMB Thai Bank are financial advisors on the IPO.

$1 = 34.6600 baht Reporting by Manunphattr Dhanananphorn; Writing by Khettiya Jittapong; Editing by Tom Hogue

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