ASTANA – Kazakhstan’s stalled People’s IPO programme has been revived to hold a new public stock offering, this time in the state-operated Kazakhstan Electric Grid Operating Company (KEGOC). Shares have been available by application to citizens of Kazakhstan since Nov. 5 and will be until Dec. 3; they will begin to be traded publicly on Dec. 19 when they will also be available to foreign investors.
The KEGOC’s current sole shareholder, the Samruk Kazyna Sovereign Wealth Fund, is offering 10 percent minus one share of its stock in the KEGOC, what is being reported as 25,999,999 shares at a price of 505 tenge [US$2.79] per share. Shares are being made available first to securities dealers, with 14,000 set aside for individual investors.
The IPO will be buttressed by Kazakhstan’s Unified National Pension Fund (ENPF), which will pick up shares of KEGOC in the event that more shares are issued than are bought by the public. “If the number of applications is less than the number of emissions, ENPF could buy KEGOC shares in accordance with its contributors’ interests. It will fulfill the role according to governmental decree,” Director of the People’s IPO Call Centre Vladimir Kovalev told The Astana Times on Nov. 14.
Interested buyers can purchase shares through brokers, Kovalev said. Buyers in more remote areas can access brokers through Kazpost, which will act as agents of brokers outside of Almaty and Astana. Buyers may sign agreements with as many brokers as they want, he said.
The sale is generating slightly more attention than the 2012 offering of KazTransOil, Samruk Kazyna’s press centre reported on Nov. 13, noting that 1,156 applications for more than 1,150,000 shares of KEGOC stock were received between Nov. 5 and 12, slightly more than the 947 applications that were received in the same period in 2012 for KazTransOil stock. KazTransOil floated 38 million shares on Dec. 25, 2012, and nearly 34,000 citizens of the country became shareholders in the company.
Samruk Kazyna reports that 30,000 people in 25 cities around the country have attended information sessions about the IPO as of Nov. 13.
The People’s IPO programme was approved in 2011, with the first IPO offered in 2012. In February, President of Kazakhstan Nursultan Nazarbayev criticised the government for allowing the programme, which was supposed to quickly float shares in five national companies, to falter. He commanded the government and the country’s National Bank to come up with a plan for both the Unified National Pension Fund and the securities market by June 2014.
Now, Kovalev said, plans are again on track for more public stock offerings, including Samruk-Energo in 2015 and both Kazakhstan Temir Zholy, the national railway company, and KazAtomProm, the national atomic company, in 2016.