Saturday, July 6, 2013

IPO - Ranhill Energy & Resources Bhd ...

The company and its shareholders are offering 328.72 million shares to institutional investors in an indicative price range of RM1.70 to RM1.85 per share, valuing the company at a forward price-to-earnings ratio of 8.8 times to 9.6. About 78.28 million shares are allocated for the retail portion.

The deal is slated to be priced on July 15, with its debut set for July 31 2013.

Cornerstone investors, which include Corston-Smith Asset Management Sdn Bhd and Eastspring Investment Bhd, took 118.27 million shares, or 12.3 per cent of the company’s enlarged share capital.

Tan Sri Hamdan Mohamad is making a comeback to the corporate world with the impending listing of Ranhill Energy and Resources Bhd.

A big player in the early 2000s, Hamdan was once dubbed Malaysia's water baron and the man behind the Ranhill group of companies, which had interest in power, energy and the utilities sectors, among others.

His main listed vehicle previously was Ranhill Bhd, which was listed in 2001 and later taken private in 2011. Its utilities arm, Ranhill Utilities Bhd, meanwhile, was also formerly listed prior to being taken private in 2008.

The companies within Ranhill Energy were part of the previously listed Ranhil Bhd.

Ranhill Energy is a local energy and water company set up in 2012 to facilitate its listing that would allow it to raise funds mainly for the repayment of its borrowings.

The company's debt denominated in ringgit, baht, renminbi and the US dollar totalled RM1.9bil proforma as at Sept 30, 2012. Of these, most will only mature after five years (RM1.35bil), while those maturing between two and five years came in second (RM410.3mil) with the rest maturing in the next two years.

Ranhill Energy would use 70% of its initial public offering (IPO) proceeds to redeem Islamic notes and bonds, 19.1% to pay off company acquisitions and 7.1% to expand its water business in China with the rest going for listing expenses.

The IPO will also see an issuance of new shares to the public

Ranhill Energy's main activity is investment holding with subsidiaries mainly engaged in two main sectors: energy and environment. In the energy sector, it has two main businesses, namely, oil and gas, in which it provides engineering and related services, and power generation.

As for the environment sector, it provides water supply services and operates water and wastewater treatment plants.

The company owns and operates two 190 megawatt combined cycle gas fired turbine power plants in Sabah and has been awarded an exclusive licence by the Government to provide source-to-tap water supply services in Johor, the second most populous state in the country.

Ranhill Energy's major shareholders include its president and chief executive Hamdan, via his private vehicle Lambang Optima Sdn Bhd and Ranhill Corporation Sdn Bhd, and regional investment fund Cheval Infrastructure Fund L.P through its general partner TAEL Management Co (Cayman) Ltd.

The two had taken Ranhill Bhd private in 2011 for 90 sen per share, valuing the company at RM538mil, with Cheval funding the privatisation. The company's shares during that time had largely under-performed due to its volatile financial performance between 2008 and 2010.

It is seeking to raise funds US$240 million to repay debt and for working capital.

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