Geothermal merger, IPO gathering steam

Three geothermal companies one based in Reno are joining forces and will try to replicate the recent successful initial public offering of Magma Energy Corp. on the Toronto Stock Exchange.

Ram Power, which is headquartered at Sierra Rose Drive, along with Polaris Geothermal of Toronto and Western GeoPower Corp. of Vancouver, plan to merge their assets under the tentative name Ram Power Corp., says Dan Schoschet, executive vice president of Ram Power. A fourth shell company, GTO Resources Inc., also is a part of the merger.

The new business entity plans to raise approximately $90 million through a public offering, Schoschet says. The IPO will be underwritten by Raymond James Ltd. and Cormark Securities Inc., the two entities that managed Magma's July 7 IPO.

Ram will serve as the primary manager of the new business venture, says Schoschet, who spent nearly 30 years as vice president of business development with Ormat Technologies Inc.

"The principal shareholders like what they saw and liked what Ram was doing and wanted to see if we would join forces and create a kind of critical mass," Schoschet says.

Ram controls six blocks in Esmeralda County that it leases from the Bureau of Land Management and is finalizing several lease blocks in California. The company employs 12, with nine working in Reno.

Polaris Geothermal operates a geothermal plant in Nicaragua, and Western GeoPower is developing a geothermal project at The Geysers in Sonoma County, Calif. It is expected to produce 35 megawatts by 2010.

The businesses have signed a letter of intent to merge and are fine-tuning the merger process, Schoschet says.

"Whenever you start to merge companies, you have people who are contributing to each company's success, and those people should continue to do what they are doing," he says. "We will continue to integrate facilities and assets."