Medco Power plans Rp 2.3t IPO

Private power producer PT Medco Power Indonesia plans to launch an initial public offering (IPO) end of this year or mid next year to raise about Rp 2.3 trillion in proceeds, reports said on Thursday.

?The proceeds will be partly used to finance some of Medco Power projects in the future,? said President Director of the company Fazil Alfitri as quoted by Investor Daily.

?We need around $1.3 billion to finance our projects up until 2017. We hope to generate some of it from the IPO,? he said as quoted by The Jakarta Post.

Fazil said that Medco, which is 51 percent owned by Saratoga through PT Saratoga Power and 49 percent by Medco Group, is currently concentrating on various projects, such as a geothermal power plant on Mount Ijen, East Java.

The 2 x 55 megawatt plant is estimated to cost $450 million. ?Our equity portion for that project will reach around $100 million and we will probably look for a strategic foreign partner to help us,? he said.

According to Fazil, the company must come up with all the necessary funding for the Ijen project in 2015 because it would begin drilling very soon. Ijen is expected to provide electricity for the Bali and Java areas from 2018.(*)