EDL-Gen chief takes on new challenges

The new CEO of EDL-Gen has assumed his role at a time when the electricity generating firm has its sights set on growth and increased power production capacity.

Mr Boun Oum Syvanpheng on Monday officially took over management of the energy company from Mr Sisavath Thiravong who now becomes managing director of the state owned EDL enterprise, which holds 75 percent of shares in EDL-Gen.

Ratch-Laos, a subsidiary of the Thai energy company Ratchaburi Electricity Gene-rating Holding PCL, was reported to hold 9.3 percent of shares in EDL-Gen as of March 16. Also on that date, staff of EDL and EDL-Gen held 1.25 percent o f shares and the rest were owned by local and foreign investors.

A ceremony to transfer the management role at EDL-Gen between Mr Sisavath and Mr Boun Oum, who is former deputy managing director of EDL, was held after shareholders of the public company approved the appointment of Mr Boun Oum as company chief earlier this month.

Mr Boun Oum has taken on the top management position at EDL-Gen at a time when the company is facing challenges to expand business and increase electricity generating capacity.

EDL-Gen had planned to issue additional shares to local and foreign investors at the end of last year, hoping to mobilise more than US$720 million to purchase hydropower plants from EDL and its shares in Independent Power Producers (IPP) but postponed the plan, citing unfavourable internal and external economic conditions.

The company announced this week that it is preparing to purchase EDL's power plants and its shares, hoping to complete the document process in the near future but was unable to confirm the exact timeframe.

The company says that from December 16, 2010, to March 31, 2012, it generated revenue of about 1,394 billion kip and spent 379 billion kip, resulting in a profit of about 714 billion kip in almost two years. In 2011, the company paid about 432 billion kip to shareholders, or 497 kip per share.

EDL-Gen shares were trading at the Lao Securities Exchange yesterday for 4,800 kip per unit. Over the past weeks, the shares have held their value, while trading volumes have also been high. This may encourage the public company to issue additional shares and mobilise more investment capital this year.

But one of the major challenges for any company in generating investment capital through the stock market is to bear in mind investor sentiment about the potential return on stocks purchased. A large number of Lao people are still suspicious of investment in stocks and are unfamiliar with the procedures involved.

Investors say that more disclosure of relevant information would give them greater understanding of the issues involved so they are better placed to make investment decisions.

vientiane times