The Kuwait authority for Partnership Projects (KAPP) has appointed a consortium led by local bank NBK Capital as adviser and offering manager for the distribution and transfer of shares in Shamal AzZour al-Oula, the owner of the country’s first independent water and power project (IWPP), Al-Zour North 1.
The initial public offering (IPO) is mandatory under Kuwait’s public-private partnership (PPP) law, which requires that the state offers 50 per cent of the total ownership of PPP projects to Kuwaiti citizens through an IPO.
Shamal Azzour Al-Oula is the first company to have been established to develop a PPP, and the first to reach the IPO stage. The company is planning to list on the Boursa Kuwait stock exchange once shares have been distributed. The IPO is expected to take place in the first quarter of 2018.
Under the provisions of the PPP law, if the public offering is not fully subscribed, KAPP can offer remaining shares to another public entity, the investor or stock market, or hold them if they cannot be sold.
In addition to the 50 per cent stake held by KAPP to be distributed to Kuwaiti citizens, the Kuwaiti government owns 10 per cent of the company through two other entities: the Kuwait Investment Authority, 5 per cent, and the Public Institution for Social Security (PIFSS), 5 per cent.
The remaining 40 per cent is held by the consortium that developed and operate the plant, comprising France’s Engie, Japan’s Sumitomo Corporation and the local A.H al-Sagar & Brothers.
The company’s power and water plant, Al-Zour North 1, began commercial operation in November 2016. Power and water produced from the plant is supplied to the country’s national electricity and water grids to the Ministry of Electricity & Water (MEW) under a 40-year energy conversion and water purchase agreement (ECWPA).