Mozambique Energy: Cahora Bassa 7.5% share sale process ongoing

The process that will culminate in the sale of 7.5 percent of the shares of the Cahora Bassa Hydroelectric Plant (HCB) to Mozambican citizens has already started. 

Manuel Gameiro, executive director of HCB, said on Monday in Maputo that, together with the Mozambique Stock Exchange (BVM) and with the advice of a British company, his institution was already structuring the sale of the shares operation.

“The first step is the one that we are now involved with which includes the design of the transaction, the determination of the criteria for the sale and the price of the shares, as well as securing some legal approvals necessary for the process to progress,” Gameiro, quoted today by Notícias, has said.

According to Gameiro, this will be followed by a stage in which the various investors will apply their financial resources for the acquisition of shares.

‘This stage will be led by the financial intermediaries – commercial banks operating in Mozambique. The third stage will be the placement of the shares according to the purchase orders that the banks will transmit to BVM, being the fourth and last stage the placement of the shares to investors,” he stressed.

Asked how long the process will last, Gameiro said that “it is difficult at this time to pinpoint an exact date, but we estimate it will take between four and five months for the shares to be effectively placed on the stock exchange”.

“At this time, we are assessing the value of HCB shares in the stock market and this study will determine their price to the public. But I can guarantee that we are a unique company in the energy sector, with a robust balance sheet and positive financial returns,” he said.

The HCB manager recalled that the company had been able to repay debt of about US$800 million to the Portuguese state during the process of the project’s reversion to Mozambican control, 18 months early.

Asked if conditions were being created to ensure the transparency of the process, the chairman of BVM’s Board of Directors, Salim Valá, who was also present at the press conference, said that “the government intends that Mozambicans be part of this movement: the democratisation, socialisation and massification of an asset that is the HCB shares”.

“The transparency of the process is guaranteed, and it is intended that Mozambicans themselves form an important element in the country’s growth and inclusive economic development, which is again one of the government’s major concerns,” Valá was quoted as saying.

The decision to sell 7.5 percent of the total shares held by the Mozambican state in HCB to new national shareholders without any kind of racial, religious, political and social distinction was made last week by President Filipe Nyusi.

Currently, the Mozambican state holds 92.5 percent of HCB’s shares, with the remaining 7.5 percent owned by the Portuguese company Redes Energéticas Nacionais (REN). Source: AIM Moçambique