Mosenergo, Russia's largest territorial generating company supplying 80% of Moscow's heating requirements and 85% of the capital and Moscow Region's electricity, will use the funds raised from the sale to develop Moscow's energy network, which is in need of major improvement.
Last October, government-run electricity monopoly Unified Energy System [RTS: EESR] decided to transfer $2.1 billion in Mosenergo stock to state-controlled Gazprom and affiliated investors.
UES, which currently holds a 50.87% stake in Mosenergo, with Gazprom owning 25%, will retain a controlling stake of 25% plus one share after the additional share issue, expected to be completed in June.
UES said Mosenergo's investment projects include the construction of four new combined cycle power units. The majority of Mosenergo's plants are gas-fuelled.
The company has 17 power plants in the region, with electric power capacity of 10,600 MWt and heat capacity of 34,200 Gkal/hour.
Mosenergo posted a net profit of 1.524 billion rubles (about $58.2 million) in 2006.
