~ Le Viêt Nam, aujourd'hui. ~
The Vietnam News

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Vietnam utility to issue bonds for power plants

HANOI - Dominant utility Electricity of Vietnam (EVN) plans to sell 900 billion dong ($56.4 million) worth of bonds this year to raise money for three power plant projects, an EVN official said on Wednesday. "The bond sale is scheduled for May or June if we can get the government permission in time," Dang Phan Tuong, Director of EVN's Privatisation and Stock Committee, told Reuters.

The 5-year bonds will be sold through the stock exchange and carry an annual coupon of 9.5 percent during its first year, Tuong said. Interest in the subsequent years will be an average of the interests of 12-month dong deposits at the four key state-run banks plus 1.2 percentage points. Proceeds from the bond, which will be underwritten jointly by Australia and New Zealand Banking Group and the Saigon Securities Inc, will be used to finance the construction of the Ban Ve, Sesan 4 and An Khe-Canak power plants.

Tuong said EVN's previous plan to sell its first overseas bond issue of $250 million in the third quarter of this year could be delayed until next year. He declined to give reasons. The state-owned utility aims to increase output by 13 percent this year to 51 billion kilowatt hours from 44.95 billion kilowatt hours generated last year to meet soaring demand. An increase in the number of private businesses and a rise in disposable incomes have resulted in electricity demand growth averaging 15 percent a year, driving the communist government to plan 60 additional power plants by 2020. EVN is the developer of most of the power plants and has 20 under construction. Last December, it started building the country's biggest hydropower plant, the $2.3 billion Son La. ($1=15,963 dong)

Reuters - May 3, 2006.