MPIC taps P8-B syndicated loan facility

Infrastructure holding firm Metro Pacific Investments Corp. (MPIC) has tapped a syndicated term loan facility worth P8 billion partly to trim the debt of its electricity business unit.

In a disclosure to the Philippine Stock Exchange yesterday, MPIC said it had signed a 10- and 15-year term loan facility to partially finance the redemption of the outstanding debt of wholly-owned Beacon Electric Asset Holdings Inc. and for other general corporate purposes.

BDO Capital & Investment Corp. was mandated as arranger and bookrunner for the syndicated loan facility.

A syndicated or club loan is a loan offered by a group of lenders that work together to provide funds to a single borrower.

MPIC is the controlling stakeholder of Manila Electric Co., the country’s largest electric power distribution firm. Investment in Meralco is held directly by MPIC at 10.5 percent and indirectly through Beacon Electric at an effective interest of 35 percent as of the end of 2017.

Meralco is the Philippines’ largest electric power distribution company, with franchise area covering 9,685 square kilometers. It provides power to more than six million customers in 36 cities and 75 municipalities including the whole of Metro Manila, provinces of Rizal, Cavite, and Bulacan and parts of Pampanga, Batangas, Laguna and Quezon. Business establishments in the franchise area account for about 50 percent of the country’s gross domestic product.

Through Clark Electric Distribution Corp., a 65 percent-owned subsidiary, Meralco holds the power distribution franchise of Clark Special Economic Zone in Clark, Pampanga. Clark Electric’s franchise area covers 320 square kilometers and 1,987 customers as of the end of 2016.