Daily analyst comments
New strategic shareholder for TGK-14?
20.07.10 10:38
TGK-14 could possibly get a new strategic owner in the foreseeable future, with Inter RAO regarded as the most likely contender. We consider this scenario as realistic, but do not expect the rumor to affect the market appeal of TGK-14 until the publication of more detailed, official data.
The Federal Antimonopoly Service (FAS) has sustained a motion filed by Transleasing, which owns 49% of Energopromsbyt on behalf of ESN Group, for the acquisition of the remaining 51% in the company. Energopromsbyt, which also controls 80% of TGK-14, is a joint-venture of Russian Railways (RZD) and ESN Group, split between the two companies in a 51:49 ratio. According to a spokesperson affiliated with Energopromsbyt, the motion the company filed to the FAS was related to RZD’s intention to quit the JV. In turn, ESN can further hand over its share package in Energopromsbyt to Inter RAO UES within an additional share issue scheduled for late 2010.
No detailed information about RZD, ESN and Inter RAO’s plans is available so far. It is possible that RZD has lost interest in TGK-14, as the genco is quite small and cannot generate a desired large synergy for a company like RZD. ESN is focused largely on the electricity retail business, and the role of a strategic shareholder in TGK-14 does not seem to appeal to it either. It is quite likely, therefore, that the strategic shareholding in TGK-14 will go to Inter RAO UES, for the genco’s assets are located closely to the Chinese border and can therefore open up new energy import and export opportunities for the holding. For TGK-14, the coming of a new strategic owner can as well offer new business development prospects.
We do not expect market demand for TGK-14 to change somewhat significantly until the publication of more detailed data.