The Board of Directors of Generation Company Four of the Wholesale Market of Power and Energy (WGC-4) has approved a Consortium of UBS Advisory Services and Troika Dialog as an investment banker providing services related to the placement of additionally issued shares in WGC-4. The Director General of WGC-4 was commissioned to enter not later than September 5, 2006, into an agreement with the Consortium for the preparation and placement of the additionally issued shares.
The WGC-4 Board of Directors decided that the implementation of the following large-scale investment projects of WGC-4 should be among the priorities of the Company's activity: construction of the CCP-400-based replacement capacity (Yaivinskaya TPP Subsidiary) and completion of the construction of Power Unit 3 on the base of SPP-800 (Berezovskaya TPP Subsidiary). The launch of construction of CCP-400 at Yaivinskaya TPP is scheduled for 2008 and the commissioning of the power unit is expected in 1Q 2011. The Power Unit Completion Project for Berezovskaya TPP will be launched in 2008 and the commissioning of SPP-800 is expected in 1Q 2010.
Earlier, similar decisions were made by the WGC-4 Board of Directors with regard to other major investment projects: construction of CCP-800 at Surgutskaya TPP-2 and CCP-400 at Shaturskaya TPP.
On August 30, 2006, the Board of Directors of RAO UES of Russia approved the additional issue of WGC-4 shares. It is expected that as a result of the additional issue, the equity interest owned by RAO UES of Russia in WGC-4 would decrease from 89.6% to at least 50% plus 1 share. The additionally issued shares are placed to raise funds for the construction of new generating facilities. It is planned to use the raised funds for the construction of replacement capacities at Shaturskaya TPP, Yaivinskaya TPP, and Surgutskaya TPP-2, as well as the Power Unit 3 Completion Project for Berezovskaya TPP. The total implementation costs for the said investment projects are more than 50 billion rubles.