Cahora Bassa Share Offer Floats This Week

  • The public share offering of 2.5% of the Cahora Bassa Hydroelectric scheme in Mozambique opened earlier this week.
  • The public offering is for 680 million shares at a face value of three meticals (€0.04) each.
  • The subscription is running until 12 July and is aimed at Mozambican citizens and companies.

The public share offering of 2.5% of the Cahora Bassa Hydroelectric scheme in Mozambique opened earlier this week, Hidroeléctrica de Cahora Bassa (HCB) announced in a press statement. This is the first phase of an operation to sell off 7.5% of the company’s share capital. The shares are expected to be admitted for trading on 22 July.

The offering is led by a Consortium composed of Banco Comercial e de Investimentos (BCI) and Banco BIG on behalf of Hidroeléctrica de Cahora Bassa (HCB) .

The 2000MW Cahora Bassa hydroelectric system is the largest hydroelectric scheme in southern Africa with the powerhouse containing five 415 megawatts (557,000 hp) turbines.

The Cahora Bassa dam forms Cahora Bassa Lake. The dam is jointly owned by Mozambique and Portugal. From independence until 2007, eighteen percent of the dam and lake was owned by Mozambique and eighty-two percent by Portugal. Portugal sold down its share to 15 percent in 2007. The Cahora Bassa dam is the largest hydroelectric power plant in southern Africa and the most efficient power generating station in Mozambique.

Dam snapshot:

  • Area: 2900 km2
  • Max length: 270 km
  • Maximum width: 30 km
  • Capacity: 52 km2
  • Foundation thickness: 21.5 m
  • Maximum discharge capacity: 14.000 m3/s

The hydro scheme has fixed contracted to supply 1,100 megawatt (MW) a year to South African electricity company Eskom, 300 to Eletricidade de Moçambique (EDM) and 50 to the Zambian state-owned power utility (Zeza).

Among recent highlights the board of directors presented was a 43% increase in revenue in 2018, following an agreement to increase prices for South Africa.

Mozambique’s state owns 85% of the shares, the Portuguese power grid company (REN), 7.5% and the other 7.5% are treasury shares held by the company itself.

Link to Share purchase opportunity brochure here.

Author: Bryan Groenendaal

 

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