OREANDA-NEWS. The Board of Directors of RAO "UES of Russia" approved an increase in the number of additional shares to be issued by OAO "TGC-10". This decision was taken due to the fact that the list of investment projects of OAO "TGC-10" to be financed with the proceeds from the additional share offering now includes a project to build the fifth power unit at the Tyumenskaya CHPP-2.

The maximum number of ordinary shares authorized for issuance will be increased to 633,000,000 from 500,000,000 ordinary shares (which makes 136.55 percent of TGC-10 authorized capital prior to the offering and 57.73 percent after the offering). The previously approved issuance of additional shares by TGC-10 was expected to raise RUB31.8 billion. Under the new plan, TGC-10 is to raise RUB46.6 billion for its investment projects.

The shares are expected to be offered to the general public in 1Q 2008. The offering will use a dual track approach, i.e. the company will simultaneously pursue a public offering and direct sale of shares to a strategic investor. TGC-10 will determine the final scheme for the offering taking into account the recommendations given by the underwriter banks.

The offering of TGC-10's new shares will be carried out simultaneously with the sale the existing shares in TGC-10 comprising the so-called "government stake". The Board of Directors of RAO "UES of Russia" approved the share sale at its meeting held 31 August 2007. RAO "UES of Russia" will put up for sale a 59% stake in TGC-10 (255,455,754 ordinary shares, par value RUB1.66 per share).

After the offering and the sale the "government stake" shares, RAO "UES of Russia" will hold at least 11 percent of TGC-10.

If the new shares are purchased by a strategic investor, RAO UES will enter into a share purchase agreement with such investor providing that it will also purchase the "government stake" stake at the same price as the new shares. If the Board of Directors of OAO "TGC-10" approves the issuance of additional shares to financial investors, the Board of Directors of RAO "UES of Russia" will reconsider the terms of sale of the "government stake" shares.