OREANDA-NEWS. May 26, 2010. Inter RAO UES (RTS: IRAO) is to hold an additional share issue by closed subscription in favor of the state, the FGC, RusHydro, Rosatom and other purchasers. In total, the company should issue 13.8 trillion new shares. The floatation procedure is to start in 4Q2010, after the ongoing share placement is completed, and end in 1Q2011. The company has already revealed a list of assets that could be used as a payment for its additional shares. The list includes a broad range of objects, including all energy retail companies presently affiliated with RAO ES of East, a number of engineering companies, state share packages in Irkutskenergo, all OGKs, TGKs, Bashkirenergo, Novosibirskenergo, RAO ES of East and other utility companies.

In our opinion, the bulk of the assets that could be handed over to Inter RAO will be further engaged in various asset swap and sales deals, as Inter RAO is set to consolidate controlling packages in some of the above companies. At the same time, Inter RAO will have to revise its current development strategy with regard to the newly acquired assets. Most likely, the updated strategy will be more targeted at expansion into the domestic energy market.