OREANDA-NEWS. June 24, 2008. The RAO "UES of Russia" Tender Commission determined the price for the sale of the 33,6% block of shares in OAO "TGC-14"* owned by RAO "UES of Russia", which are attributable to the "government stake".

Having analyzed the bids received, the Tender Commission determined that the highest price was offered by the company Energopromsbyt, namely, RUB 0.0074 per one share or \\$464 per kW of installed capacity.

The TGC-14's Board of Directors has determined the offering price for the additional shares of the company. As provided by the resolutions previously adopted by the Board of Directors of RAO "UES of Russia", the sale of the TGC-14's shares from the "government stake" and the sale of the additional shares are carried out at the same price to one strategic investor. Therefore the price of the additional shares offering was based on the maximum price offered by the strategic investor for the "government stake".

The final quantity of the additional shares of TGC-14 to be issued to Energopromsbyt will be announced on 1 July 2008 after the shareholders of the TGC exercised their pre-emption right on the additional shares.

As a result of sale of the "government stake" shares RAO "UES of Russia" will raise over RUB 1.8 billion in private investments. Offering of additional shares may generate for TGC-14 some RUB 4.29 billion in proceeds. Thus, the total amount of funds expected to be raised from the additional share issue and the sale of the "government stake" shares in TGC-14 is in excess of RUB 6 billion.

After the sale of the "government stake" and the additional share offering, the shareholding of RAO "UES of Russia" in TGC-14 will decrease from 49.66% to 9.19%. This stake will be distributed among the RAO UES minority shareholders in course of the final phase of the Company's reorganization.

The funds raised by TGC-14 as a result of the additional share offering will be used to expand its generation capacities under the framework of the company's investment programme for the period until 2012. Among the company's priority projects are reconstruction of the 1-st and 2-nd units at Ulan-Ude CHPP-2 and of the 2-nd unit of Chita CHPP-2. The proceeds from the sale of the "government stake" shares in TGC-14 will be used to finance the investment programme of Federal Grid Company.