Inter RAO hunts for investors

City A.M. Reporter
INTER RAO could seek a strategic investor for a 25 per cent stake and may also consider share swaps as it continues to grow, the Russian state-controlled group’s head Boris Kovalchuk said yesterday.

The electricity generator and power trader is being used by Russia as a home for billions of dollars of assets as the government seeks to create a consolidated power generation giant with ambitious plans abroad.

Inter RAO, which boasts influential deputy Prime Minister Igor Sechin as head of its board, said last month it would raise cash via a rights issue to buy the assets worth $9bn-$15bn (£5.6bn-£9.4bn).

Earlier this week it said it would buy the British holding company REDI, which owns a 49 per cent stake in gas producer Northgas, for $1.5bn.

Kovalchuk said in an update on the company’s strategy the group would consider selling a 25 per cent stake by 2015.

“Inter RAO is interested in attracting a strategic investor, for which we have set aside 25 per cent of shares. It could be a Russian energy or fuel company, it may be a foreign company that could provide synergies,” he said. Grid company FSK and state-controlled RusHydro have already been lined up to buy stakes of 17-20 per cent and six per cent respectively.

The move could be seen as part of a multi-billion dollar privatisation programme of state assets set to kick off in earnest this year.

Kovalchuk also said he would consider a share swap with foreign companies – a deal structure that would mirror the agreement signed by Russia’s biggest oil producer Rosneft and BP last week.