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EDL to list on Lao stock exchange
Electricite du Laos, one of the largest state-owned enterprises, plans to list its power generation sector when the Lao stock market opens at the end of this year, according to a top company official.
EDL Managing Director Khammany Inthilath said yesterday the company had three areas of operation – electricity generation, power grid and station, and electricity distribution – but only the first will be listed on the stock market.
Mr Khammany, who is Lao National Assembly member for Constituency 10, Vientiane province, was speaking to Vientiane Times on the sidelines of the assembly’s ongoing 9th ordinary session.
EDL is now preparing to establish a sub-company to manage its hydropower plants and power stations nationwide and hopes to list this company on the stock market, which is scheduled to open in October.
Mr Khammany said when the sub-company is set up it will make an estimation of its assets, one of the criteria for issuing an Initial Public Offering (IPO).
He expected the electricity generating company would be able to issue the first IPO in 2011, adding that the company has to make changes including improving the transparency of its operations to meet the requirements of the Lao Stock Market.
He was unable to confirm the exact number of shares the government would sell to the public, but said the government may keep 60 percent to retain its decision-making capability.
Mr Khammany said the government may use the income it earns from the sale of the company’s shares to develop the hydropower industry or for other development projects. The government needed large capital reserves to develop the country over the next five years, he added.
The government needs resources to build hydropower plants for both domestic consumption and for export to generate revenue.
The public will be encouraged to own shares in state-owned enterprises so they can play a role in the country’s development. The government will also benefit from the transparent operation of state-owned enterprises listed on the stock market.
Mr Khammany said EDL first planned to list on the stock market in 2008 after gaining permission from the government. The company hired a Thai firm to conduct a feasibility study on EDL’s listing.
The result of the study was a main reference point for the company to improve itself so it would comply with stock market regulations.
In the past few years, EDL and other state-owned enterprises have looked at how companies in countries such as the Republic of Korea and Malaysia enter the market, as this is a new experience for Laos.
Vientiane Times
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