Renewable energy developer Vidullanka PLC is experiencing some headwinds in its attempt to acquire a Uganda-based renewable energy firm, which will delay the issuing of Vidullanka shares to fund
Vidullanka had in February proposed to issue 9.1 million ordinary shares worth Rs.50 million in a private placement to Timex Garments (Pvt) Limited, in order to partially fund the acquisition of Timex subsidiary Timex Bukinda Hydro (U) Limited.
However, Vidullanka said that it has run into delays in obtaining the necessary approvals from the Electricity Regulatory Authority of Uganda and the Exchange Control Department of the Sri Lankan Central Bank, which would push back the issuance of shares. “The company wishes to proceed immediately with the private placement at least with one of the approvals secured,” Vidullanka said in a stock exchange filing.
Timex Bukinda Hydro has acquired all necessary approvals except for the signing of the Standard Power Purchasing Agreement for the development of the 6.5 MW Bukinda Small Hydro Power Plant in Uganda.
Vidullanka entered Uganda in 2015 to construct the US$ 13.5 million 6.5 MW Muvumbe Small Hydro Power Plant, which was commissioned last month.
Many Sri Lankan renewable energy developers are now entering East African countries to construct power plants, and many international development agencies are providing sizable grants and concessional loans for such construction.