By an OGJ Online Correspondent

BANGKOK, Thailand, Feb. 26, 2001—Tractebel SA, the Belgian energy arm of French utility Suez Lyonnaise des Eaux, has moved to consolidate its power portfolio in Thailand.

The firm is close to acquiring an additional 17% stake in Cogeneration PLC (COCO), one of the largest private power producers in Thailand, held by the Thai coal mining and energy group Banpu PLC and Nordic Power Invest AB of Scandinavia.

Tractebel has already signed an agreement to purchase a 10.78% stake in COCO held by Banpu for $51.37 million (2.20 billion baht). Tractebel is also determined to conclude a deal to buy about 7% of COCO shares held by Nordic Power by March 1 at an estimated cost of $20-30 million.

The completion of the Tractebel-Banpu deal, involving nearly 130 million shares at 17 baht/share, is subject to the conclusion of an accord for Tractebel to purchase COCO shares from Nordic Power. The completion of the two deals will boost Tractebel’s holding in COCO to about 80% from 62%. It would consolidate its control over the company which operates three cogeneration power plants on the Thai eastern seaboard with a combined electrical generating capacity of 770 MW and 930 tonnes/hr of steam.

Tractebel’s aggressive bid for COCO began in November when it bought the 62% COCO stake from U.S.-based Sithe Energies Inc.

That transaction formed a major part of Tractebel’s $490 million acquisition of Sithe’s entire power assets in Thailand (OGJ Online, Nov 10, 2000). The proposed acquisition will boost Tractebel’s power portfolio in Thailand to more than 2,000 MW from 1,900 MW currently.

Tractebel is already the largest private foreign power investor in the kingdom. Johan de Saeger, director of Tractebel Thailand, the local unit of Tractebel, said adding to its COCO stake will strengthen its energy interests in Thailand, in addition to Singapore and South Korea.

Strategic move for Banpu
On the other hand, Banpu and Nordic Power are disposing of their COCO interests because they consider these holdings—relatively small compared to Tractebel’s—not as strategically important, he noted.

Analysts said Banpu’s sales of COCO shares to Tractebel represent a sound strategy, with the Thai firm standing to gain a lot from the transaction. Patareeya Benjapholchai, senior vice-president of Stock Exchange of Thailand, said with Sithe Pacific Holding, a former-major shareholder of COCO, having fixed the tender offer price for COCO shares at around 20.33 baht, Tractebel will have to offer a higher price.

Meanwhile, Banpu has turned its interest to Ratchaburi Holding PLC, the listed electricity subsidiary of Electricity Generating Authority of Thailand.

Banpu Pres. Chanin Vongkusolkit said he was seeking an appointment with Ratchaburi’s Pres. Boonchoo Direjsataporn to discuss “synergy development.” Banpu already holds about 10% in Ratchaburi after spending 2 billion baht since last October accumulating the stock on the open market.

Chanin said Banpu envisioned low-risk growth potential for Ratchaburi and believes efficiencies could be achieved between Ratchaburi and Banpu’s affiliated firm Tri Energy, the joint venture that runs a 700 MW combined cycle power plant in Ratchaburi.

Separately, COCO reported a loss of 1.56 billion baht or 1.30 baht/share for the 6 months ended Dec. 31., 2000. Analysts said COCO remains at least 2 years away from making a dividend payment.

Banpu reported a net profit of 1.75 billion baht or 8.3 baht/share, compared to a net loss of 299 million baht or 2.85 baht/share in same period a year ago. The latest results include its 2.55 billion baht gain from the sale last year of COCO shares to Sithe Pacific Holding.