The first stage of an equity offering in a 135.6-MW private power plant being built in
Lahore is due to close in October, and had already received a strong response from international investors by late September, according to the underwriters. The $120 million plant is being built by Japan Power Generation (JPG), with the support of two Japanese firms, Mitsubishi Heavy Industries (MHI) and Toyota Tsusho Corporation (TTC).
Islamic Investment Company of the Gulf (Bahrain – IICG), the Bahrain- based investment banking arm of Dar Al Maal Al Islami, is co-ordinating the financing for the project, and has underwritten the $23.5 million equity portion. The balance of funds will come from a term loan.
The equity financing is being raised through a $15.4 million international offering which will close on 20 October, followed by an $8 million offering to local investors in December. IICG says the international offering was oversubscribed in late September. Jardine Fleming Hong Kong is the sub- underwriter and co-placement agency, and Credit Lyonnais Securities (Asia) is also part of the placement syndicate.
Work on the project has already begun, and the plant is expected to be commissioned in late 1996. TTC is the supplier and MHI is manufacturing the equipment for the plant. MHI also has an operations and maintenance contract with JPG. The civil and installations works are being carried out by Siemens (Pakistan).
The government has guaranteed to purchase the electricity produced by the plant through the Water & Power Development Authority, and has also guaranteed to supply fuel through the Pakistan State Oil Company.