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Sun 22 Apr 2007 03:18 PM

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Saudi Electricity dividends remain the same

Shareholders approve dividends and sukuk sales to fund the rising power demands.

Saudi Electricity Co. said on Sunday its shareholders had approved the distribution of a SAR0.7 ($0.19) cash dividend for 2006, unchanged from the previous year.

Shareholders also approved plans to sell Islamic bonds, or sukuk, to help finance the company's investment plans, Saudi Electricity said in a statement on the bourse's website. It did not give more details.

The Gulf's largest utility by market value will pay SAR2.9 billion to shareholders, according to a Reuters calculation, more than double the company's 2006 net profit of around SAR1.4 billion.

Saudi Electricity has been struggling to find the funds to meet growing power demand. King Abdullah last year ordered financial aid for the company to help it cope.

Company executives said last month Saudi Electricity may sell between SAR11 billion and SAR15 billion of sukuk during the next 10 to 15 years.

One company official, who declined to be identified, said the bonds would be sold in as many as five batches with maturities of five to 10 years, with the first issue planned in the second half of the year.

The state-controlled company has said SAR150 billion of investment is needed in the next decade to cope with rising demand for electricity in the world's top oil exporter, which has a population of about 24 million.

Saudi Electricity made a first-quarter net loss of SAR434 million.

On Wednesday, Saudi Arabia's
Al Hayat

newspaper reported that Saudi Electricity said it did not expect to ration power in the summer, despite reports that said power cuts in the Eastern and Central provinces would continue until summer of 2009.

Wednesday's report said that power supply in the kingdom would run at full capacity to prevent recurrence of last summer's power cuts.

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