21 Sep 2010 14:40

Regulators clear IES to consolidate retail business in TGK-9

MOSCOW. Sept 21 (Interfax) - The Federal Antimonopoly Service (FAS) has cleared TGK-9 , a territorial generating company controlled by Viktor Vekselberg's IES Holding, to acquire Retail Holding, which consolidates IES' retail assets, the FAS said in a statement.

IES reported earlier on the consolidation of its electricity assets, both generation and retail. IES Holding President Mikhail Slobodin said the consolidation would most likely be in TGK-9, in which IES has the biggest stake (over 75% of shares).

IES Holding controls five ERCs: Sverlovenergosbyt , Kirovenergosbyt , Orenburgenergosbyt, Komi Power Sales Company and Udmurskaya Power Sales Company. It also owns Permenergosbyt jointly with Andrei Kitashev, the former general director of OGK-4 . The retail companies are all part of Retail Holding, which is owned by two IES offshore companies: Basly Management Limited and Wilmington Investments.

The consolidation, including the move to consolidated shares, will take 18-24 months, after which the company will consider an IPO. Credit Suisse and VTB are the consultants for the share consolidation.

TGK-9, TGK-5 and TGK-6 will also take part in the consolidation. IES is the majority shareholder (46%) in another territorial generating company, TGK-7, but Gazprom is currently disputing ownership of a portion of the IES stake in court. In addition, Inter RAO UES , which is likely to receive a 30% stake in TGK-7 currently held by Federal Grid Company , is also interested in the genco. IES will make a decision on whether to include the TGK-7 stake in the consolidation before the end of the year, Slobodin said.

The IES gencos have about 16,000 megawatts of installed capacity. They plan to produce 56.2 billion kilowatt-hours of saleable electricity in 2010.