How EDL-Gen is diversifying its Thai investor base

Plans to raise up to 17.5 billion baht through debentures

Laos' major renewable energy generation company, EDL-Generation Public Company (EDL-Gen), has concluded a roadshow to meet Thai investors as it prepares to launch another fund raising in the Thai baht bond market. The company plans to raise up to 17.5 billion baht (US$545.85 million) in July 2018 from Thai institutional and high net worth investors through debentures comprising of six tranches with maturities of three, five, seven, 10, 12 and 15 years. The new fund raising will represent a diversification for EDL-Gen in terms of investor base since its previous two offerings in the Thai debt market were sold mostly to institutional investors. This time around high net worth investors have shown strong interest. "We intend to distribute a significant sum of the debentures to this group of investors for their diversification," says Adisorn Singhsacha, founder and CEO of Twin Pine Group, which is acting as the sole adviser to EDL-Gen.

EDL-Gen, a subsidiary of the state-owned Electricite du Laos (EDL), produces power both for domestic consumption and for supply to neighbouring markets, including Thailand. It owns – wholly and partially – 16 hydropower plants and a solar farm with a combined production capacity of 1,137MW. It is in the process of acquiring stakes of 20% each in Xayaburi and Donsahong hydropower plants from EDL. Expected to commence commercial operation in 2019, Xayaburi hydropower plant has an installed production capacity of 1,285MW, while Donsahong hydropower plant has an installed capacity of 260MW. EDL-Gen deputy managing director Bounsalong Southidara says the 20% stake in each of the plant will cost about US$450 million and will raise the company's production capacity by 350MW.

EDL-Gen will determine the other details of the offering, including the coupon rates, in early July 2018. It has appointed five banks as joint lead arrangers for the transaction, namely Bangkok Bank, Krung Thai Bank, Siam Commercial Bank, Standard Chartered (Thailand) and Thanachart Bank.

EDL-Gen first tapped the Thai baht bond market in December 2014 when it raised 6.5 billion baht in multiple tranches, representing its first offshore bond and the first corporate bond for a Laotian company in Thailand. It returned to the Thai debt market in 2016 when it issued in early September its inaugural US dollar bond amounting to US$312 million to finance its business expansion programme.

Date

13 Jun 2018

Channel

Treasury

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