April 5, 2023 | Investopaper
Global Hydropower Associate Limited is in the process of issuing shares to the general public (IPO). For this purpose, the company has appointed Mega Capital Markets Limited and Nepal SBI Merchant Limited as the underwriter for shares.
An agreement has been reached between the company and two merchant bankers on this regard. The agreement was signed by Motilal Dugar, Chairman Of Global Hydropower Associate Limited and Shulav Shrestha, Acting Chief Executive Officer of Mega Capital Markets Limited, and Devraj Adhikari, CEO of Nepal SBI Merchant Limited .
Now, the company needs to appoint the issue and sales manager for the IPO. It should then submit the application to the Securities Board Of Nepal (SEBON) after completing the necessary procedures. Only after the approval from the regulatory body SEBON, the company can sell shares to the public.
In the first phase, the company will issue shares to the locals of the project affected areas and foreign employed Nepalese. Likewise, in the second phase, the hydropower will float shares to the general public, including the employees of the company and the mutual fund schemes.
In total, the company plans to sell 58,60,000 shares that amounts to Rs. 58.60 crores in the public offering (IPO).
About Global Hydropower Associate Limited
Global Hydropower Associate Limited was established on April 5, 2002 as a private limited company. Later it was transformed into a public company in order to issue shares to the general public.
The company is currently developing Likhu 2 Hydropower Project in Solukhumbu and Ramechhap district. The project is a run-off-river (ROR) type project with an installed capacity of 55 MW.
Global Hydropower Associate Limited has already signed a long term Power Purchase Agreement (PPA) with Nepal Electricity Authority (NEA) on on March 3, 2015 for sale of 33.4 MW electricity to be generated from the project. The tariff for wet season (Mid-April to Mid-December) is Rs 4.80 per kWh and for dry season (Mid-December to Mid-April) is Rs 8.40 per kWh with 3 percent escalation on base tariff for 8 years.
The estimated cost of the project is Rs. 9.31 billion which is being funded through a debt equity ratio of 80:20.
The company is mainly promoted by MV Dugar Group and Mogha Energy DMCC, UAE.