PSALM to raise P80B for 2012 requirements

State-run Power Sector Assets and Liabilities Management Corp. (Psalm) plans to start raising P80 billion in the fourth quarter of this year for its financing requirements in 2012.

In an interview, Psalm president and CEO Emmanuel R. Ledesma Jr. said the amount would be used to pay maturing obligations and meet capital requirements for the period.

Psalm, however, remains undecided as to how it will raise the funds. Ledesma said the decision would depend on the condition of the economy and the financial market by that time, which would be between November and December.

Among the factors that will be considered are the prevailing interest and foreign exchange rates by that time, he added.

In June, Psalm secured a P75-billion syndicated term loan facility for its working capital and debt servicing requirements this year.

The loan helped cover Psalm’s obligations that included a P25-billion short-term loan with Land Bank of the Philippines, which fell due in May; the P18-billion bond which was paid last month; independent power producer debts; and other contractual obligations arising from the operations of the remaining unsold assets.

Ledesma earlier said the state firm was compelled to secure additional funding to fulfill its mandate to operate and maintain the plants still under its portfolio. Psalm was mandated to clear the books of the cash-strapped National Power Corp. (Napocor).

As of end-2010, Napocor’s total liabilities stood at $15.8 billion.

Also, the deferment of the asset privatization program—which would have been a source of funds for PSALM—and the inclusion of National Transmission Corp.’s operating expenses in its financial requirements made it necessary for the agency to raise funds, Ledesma said.

Psalm will finally resume its privatization activities next month, starting with the 149-megawatt Naga power complex in Cebu.