Salalah power project company starts flotation

28 August 2013

The Salalah independent water and power project began commercial operation in May 2012

The Sembcorp Salalah Power & Water Company, the developer and owner of the Salalah independent water and power project (IWPP), has launched an initial public offering (IPO) for 35 per cent of issued share capital of the utilities company.

The IPO was launched on 28 August and will run until 26 September 2013. Shares will priced at RO1.59 ($4.12) each, inferring a total offer size of RO53m and a market capitalisation on listing of RO152m. The Salalah IWPP began commercial operation in May 2012.

David Guy, chief executive officer (CEO) of Sembcorp Salalah, says the IPO offers an attractive option for investors. “The key point is that it is a well-proven and trusted business model. The government guarantees payment obligations and there is a strong predictability of cash flow.”

The gas-fired power plant has a total generation capacity of 490MW and the seawater desalination component has a total water production capacity of 15 million gallons a day (g/d). The developer will provide power to the Oman Power and Water Procurement Company (OPWP) for a period of 15 years.

HSBC Bank Oman is the issue manager for the IPO, and the first day of trading will be on about the 10 October.

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