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PT Medco Power plans IPO to fund its energy projects

Indonesia Stock Exchange, Jakarta (source: flickr/ nseika, creative commons)
Alexander Richter 7 May 2014

PT Medco Power Indonesia plans to raise more than $200 million in IPO to finance several of its energy projects, among them the Sarulla and Ijen geothermal projects.

PT Medco Power Indonesia will step into the Indonesian Stock Exchange (BEI), and target emission value of more than USD 200 million from the event Initial Public Offering (IPO). IPO proceeds will be used to finance a number of projects by the year 2017, with a value of $ 1.3 billion.

Director of Medco Power, Fazil Erwin Alfitri said the plan began to be held in late 2014 or mid-2015, and is still waiting for certainty shareholders. Currently the company is reviewing and finance is reporting in June 2014 as the basis for evaluation of the IPO.

“We are already preparing for an IPO since 2015 needs also quite large,” said Fazil in Jakarta, Wednesday (07/05/2014).

According to him, the study will seek a best option to do an IPO, looking at the condition of the capital market in Indonesia. Since at least, the company should open the option to hold a strategic partner before the IPO by issuing new shares prior alias rights issue.

“Later this month we will discuss whether we will pre-IPO first instance with a rights issue. We can escape the first 10% -20% of the shares and invite a new partner before the IPO, “he explained.

Medco Power IPO into road meet capital expenditure. The company does have some major projects.Among Sarulla geothermal power plant, Geothermal Project Ijen, five mini-hydro projects, and electrical energy projects Batam.

Previously, Ijen Geothermal projects are considered to require substantial funds to the project with a capacity of 110 Mega Watts (MW), and is expected to begin work on next year. Even today Medco Power is also looking for a strategic partner to take a minority stake Ijen project.

“So in terms of funding, Medco can be lighter in working on this project,” he said.

Currently, Medco Power’s total equity of approximately U.S. $ 100 million. “Then I estimate the position of the balance sheet amounted to U.S. $ 550 million by the end of the year,” he said.”

Source: Berita Headline