Summit Power defers over US$200m Singapore IPO, citing 'market volatility'

SUMMIT Power International, the first Bangladeshi company slated to list on the Singapore Exchange, has delayed indefinitely its more than US$200 million initial public offering (IPO), the Business Times has learnt.

In a message sent to investors on Tuesday morning, Summit said that "in light of recent market volatility, the company has decided not to proceed on its current IPO timeline."

"The company will re-assess the situation in conjunction with key stakeholders and strategic partners, and will provide a further update in due course," said the message.

Summit's IPO prospectus lodged on Apr 12 had the Asian Development Bank as a cornerstone investor.

Market participants told Reuters there was an overall lack of demand from institutional investors and private banking clients for non-real estate investment trust IPOs in Singapore.

According to Reuters, Summit had already compromised on the size of the deal, loweing it to US$260 million from the US$350 million indicated during premarketing, with shares being marketed at US$1.02 to US$1.20.

The deal was to comsist of a public offer of US$202.5 million and a cornerstone tranche of US$57.5 million, said Reuters.

Summit is the largest independent power producer in Bangladesh, and owns 15 operational power plants there which have an aggregated installed capacity of 1,201MW. This gives it a 21 per cent market share of the total private installed capacity as at Dec 31, 2017.

Summit had said that it was tapping the Singapore market for funds to expand and meet "the growing demand for power in Bangladesh's under-served power market", with about US$150 million from the proceeds going towards funding projects and working capital.