Aboitiz nears takeover of Mindanao coal plant
Aboitiz Power Corp. is hoping to close the transaction for acquiring an entity under German company STEAG GmbH in about two months’ time, its top executive said.
“We’re looking at probably at the next 60 days to have everything closed down,” said AboitizPower president and CEO Emmanuel Rubio.
AboitizPower, the holding firm for the Aboitiz Group’s investments in power generation, announced last month the acquisition of an additional 35.4-percent stake in STEAG State Power Inc. (SPI).
The transaction was valued at $36.1 million or about P2.1 billion, inclusive of locked box interest at a rate of 4 percent from Jan. 1, 2021 to March 31, 2022.
Closing the sale would involve meeting precedent conditions including the submission of corporate approvals and consent from lenders and the state-run Power Sector Assets and Liabilities Management Corp. (Psalm).
SPI, the local subsidiary of STEAG, operates the 210-megawatt Mindanao coal-fired power plant, including the transmission line and related facilities, situated at the Phividec Industrial Estate in Villanueva town in Misamis Oriental. Its commercial operations began in November 2006.
Upon closing, AboitizPower would increase its stake in SPI to 69.4 percent while that of STEAG would decrease to 15.6 percent. Agribusiness, livestock and food company La Filipina Uy Gongco Corp. would continue to hold the remaining 15 percent.
The Mindanao coal facility, according to SPI’s website, was constructed through a build-operate-transfer partnership with the National Power Corp. (Napocor) for a period of 25 years. This arrangement will end on Nov. 15, 2031.
Psalm then assumed ownership of Napocor’s power assets and was tasked to settle the latter’s financial obligations by the Electric Power Industry Reform Act.
AboitizPower had said the deal would result in the expansion of attributable net income without adding new coal capacity to the grid and help provide the much-needed capacity in the Luzon grid.
“That’s why I’m looking forward to NGCP (National Grid Corp. of the Philippines) completing the Mindanao-Visayas [Interconnection Project] but as it is, it’s being paid [a] capacity fee by PSALM,” Rubio told reporters.
The P52-billion project, slated for completion before the year ends, was envisioned to connect the power grids in the Visayas and Mindanao resulting in a single national grid. NGCP earlier said it had put in place the MVIP’s integral components.
Meanwhile, the 2×668-MW supercritical coal-fired power plant in Mariveles, Bataan may commence commercial operations by November.
“We’ll probably declare commercial operations by mid to end-November but they are now running at full capacity,” said Rubio, adding the company sees no problem in the plant’s commercial run.
GNPower Dinginin Ltd. Co. (GNPD), AboitizPower’s joint venture with the Ayala Group, is the operator of the said coal plant. INQ
