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SMC Global Power launches new P20B bond offer

/ 09:04 AM December 13, 2017

The power generation arm of conglomerate San Miguel Corp. returned to the local bond market on Tuesday with a new offering of P20 billion worth of retail bonds at multi-year tenor.

This is part of the P35-billion bonds recently approved by the Securities and Exchange Commission for shelf registration or staggered issuance for the next three years by SMC Global Power Corp., one of the country’s leading power generation firms.

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The offering will run until Nov. 15 while listing of the bonds on the Philippine Dealing & Exchange Corp. will happen on Dec. 22, said Eduardo Francisco, president of BDO Capital & Investment which is among the issue managers.

The bonds will carry the following interest rates per annum: 5.375 percent for the five-year tenor, 6.25 percent for the seven-year tenor and 6.625 percent for the 10-year tenor, Francisco said in a text message.

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Francisco said the key pitch for these retail bonds was that these are triple A-rated securities and SMC Global Power was part of the storied San Miguel conglomerate.

Bond proceeds will be used for debt repayment, particularly to BDO Unibank and Philippine National Bank.

SMC Global Power earlier borrowed money from these financial institutions to infuse equity to various projects such as Davao Greenfield Power plant, Limay Phase 1 and Phase 2 greenfield power plant, Angat Hydro Power Plant and Limay C-Generation Power Plant (sold to Petron in 2016).

BDO Capital, PNB Capital and Standard Chartered Bank (SCB) are the joint issue managers of the offering. BDO Capital, BPI Capital, China Bank Capital, RCBC Capital and SCB are the joint lead underwriters and bookrunners.

SMC Global Power is one of the largest power companies in the Philippines, controlling 3,063 megawatts of combined capacity as of June 2017. It has diversified fuel sources to include natural gas, coal and hydroelectric energy.

To date, SMC Global Power has an estimated 15 percent market share of the power supply of the national grid, 20 percent of the Luzon grid and 5 percent of the Mindanao grid.

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TAGS: bond offer, Eduardo Francisco, SMC Global Power
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