RPT-UPDATE 1-Capital Power C$500mln IPO targets global investors

(Repeats to widen distribution)

* Shares marketed to Canadian, U.S., Europe clients

* To sell at least 21.750 mln shares at C$23 each (Adds details on eligible U.S. investors in 4th para)

By Pav Jordan

TORONTO, June 29 (Reuters) - Canada's largest initial public offering of the year will be launched next month, creating the second-largest pure-play power company in the country and signaling a rebirth in the nearly moribund Canadian IPO market.

An IPO by Capital Power Corp (CPX.TO) is being marketed to investors in Canada, the United States and Europe, and is expected to close on July 9, when the issue will start regular trading on the Toronto Stock Exchange.

"Geographically, (the marketing is) Canada first and then Europe, and the United States as well, but on the U.S. side on an institutional basis," said Martin Kennedy, a spokesman for Epcor Utilities Inc, the municipally owned utility that is spinning off its C$5 billion ($4.3 billion) power generation assets to form the company.

In the United States, the offering will be available to "qualified institutional buyers," and not to retail investors.

If successful, the IPO would be the biggest this year in Canada and support forecasts that the market for global initial public offerings is starting to perk up.

Kennedy would not comment on the status of the IPO because it has yet to close.

According to filings with local regulators, the company aims to sell at least 21.75 million common shares at C$23 each, generating some C$500.25 million before deducting the cost of the offering.

There is an over-allotment option for 3,262,500 shares which, if exercised, would bring total cash raised to over C$575 million.

Epcor, the utility company of the city of Edmonton, the capital of the Western Canadian province of Alberta, would control 72.2 percent of the company if the IPO is a success. If the over-allotment option is exercised, it would control 68.1 percent.

Either figure would make the Capital Power Corp IPO Canada's biggest to date in 2009, far exceeding a C$100 million initial public offering last week by Magma Energy Corp, a geothermal power company active in the western United States and South America.

Capital Power Corp. shares are already trading on a temporary, if, as and when basis and were down 0.4 percent on Monday at C$22.55.

Capital Power will operate 3,300 megawatts of generation capacity at 31 coal, natural gas and renewable generation facilities in Canada and the United States.

It will be Canada's second largest publicly traded pure-play generation company after TransAlta Corp (TA.TO).

Epcor plans to eventually sell all of its financial interest in Capital Power over time, although that could be "many years out," Kennedy said.

The offering is being underwritten by TD Securities Inc, Goldman Sachs Canada Inc, RBC Dominion Securities Inc, CIBC World Markets Inc, BMO Nesbitt Burns Inc, Scotia Capital Inc, National Bank Financial Inc and HSBC Securities (Canada) Inc.

The final offering price of the common shares will be determined by negotiation among the company, Epcor Utilities Inc and the underwriters.

($1=$1.15 Canadian)

(Reporting by Pav Jordan; Editing by Rob Wilson and Richard Chang)