Thilawa backers prepare for share sale

Thilawa backers prepare for share sale

By Sandar Lwin   |   Sunday, 04 August 2013

Shares in a planned public company that will develop the Thilawa Special Economic Zone could go on sale within six months, Deputy Minister for National Planning and Economic U Set Aung said last week.

The company will launch an initial public share offering in early 2014 at the latest, said U Set Aung, who is also chairman of the zone's management committee.

"The development of the Thilawa SEZ must be completed by 2015 so the necessary construction work will have to be started in early 2014 ... and the company's shares will go on sale before we start the construction work," he told The Myanmar Times in an interview on July 29.

"We also need to elect a board of directors and complete various tendering processes. For the moment, we are calculating how much capital needs to be invested from the Myanmar side. The date of the public offering launch is dependent on the completion of that calculation."

The governments of Japan and Myanmar have agreed to develop the Thilawa Special Economic Zone in Thanlyin township, about 25 kilometres (15.5 miles) southeast of Yangon along the Yangon River. The agreed share ratio will be 49-51, with Myanmar holding the majority. Media reports have said Mitsubishi, Sumitomo and Marubeni will head the Japanese consortium.

U Ye Min Oo from Dagon Group of Companies, which is owned by U Win Aung, who also chairs the Union of Myanmar Federation of Chambers of Commerce and Industry (UMFCCI), said nine public companies are working as promoters of the public company. He added that the proposed public company has filed an application for registration to the Directorate of Investment and Company Administration (DICA).

While he would not reveal the nine companies involved, sources confirmed that one is First Myanmar Investment, a subsidiary of Serge Pun Associates.

"[The promoters] filed [an application] to DICA in June for company registration. It is still ongoing and we haven't got a reply from DICA yet," U Ye Min Oo said.

While declining to comment specifically on the Thilawa SEZ public company, U Soe Thein, the executive director of Myanmar Security Exchange Company (MSEC), said that international best practice required public companies to file a prospectus when performing a public offering.

"The preliminary prospectus with the expression of the amount of capital necessary to be raised [for the intended business] must be presented for the public company registration," he said. "After filing the preliminary prospectus, the promoters can appeal to the public to buy shares but the actual sale can only be launched after finalising the prospectus and it being accepted by the registration authority. To prepare the prospectus, the exact amount of capital to be raised must be stated."

U Ye Min Soe said the nine "promoters" are still finalising the amount of capital they will seek to raise through the offering but would publicise all of the required information.

"And many parts of the IPO process, including even the official name of the company, still need to be approved.

"The nine promoters will finish these works. When a valid company structure has been developed, they will publicise the information. Then, all information on the entire process of the formation of the company, to the company's operations and in what role the company will be operating at the Thilawa SEZ development and so on will be declared and advertised."

He added that the nine promoters would not receive any "special privileges" for their preliminary work.

"The entire company will be owned by the public through shares," he said. "None of the shares are reserved for the nine promoters. They have just been organised as a working team to initiate the formation of the company and deal with the Japanese partners. When the IPO is launched, it is up to them whether they buy shares.

"U Win Aung, the chairman of UMFCCI, has also clearly told the nine companies they are just promoters and will not receive any special privileges."

Source: http://www.news.myanmaronlinecentre.com/2013/08/05/thilawa-backers-prepare-for-share-sale/