Alsons raises P1.4B via debt market to fund new power plants

Alsons Consolidated Resources Inc. (ACR) has listed P1.4 billion in commercial papers with the Philippine Dealing Exchange Corp., the first tranche of a P3-billion program intended to support new power plant projects.

ACR has until June 2024 to offer the remaining tranche or tranches.

“We are pleased with the opportunity to provide investors with an attractive alternative investment outlet as we once again tap the short-term capital market in our continuing quest to ensure the provision of safe, reliable and affordable power for the people of Mindanao and other areas of the Philippines,” ACR chair and president Nicasio Alcantara said in a statement.

For this tranche, ACR tapped Multinational Investment Bancorporation as issue manager, arranger and underwriter as well as Acuña and Francisco Law as the legal counsel. AB Capital and Investment Corp. was engaged as facility agent.

Last January, PhilRatings Corp. gave this transaction an “A plus” rating with a “stable” outlook. This means the issuer has an above average capacity to meet its financial commitments.

Working capital needs

ACR’s previous issuance of up to P2.5 billion, registered with the Securities and Exchange Commission in 2018, received a similar grade from PhilRatings.

Back then, ACR deputy chief financial officer Philip Sagun said they wanted to again tap the short-term capital markets for their working capital needs and to pursue power projects to expand ACR’s fleet in anticipation of rising electricity demand.

ACR’s projects include the P4.5-billion 14.5-megawatt Siguil Hydro run-of-river hydroelectric power plant in Maasim, Sarangani province.

The Siguil project is ACR’s first foray in the renewables business. Construction is ongoing and is targeted to be completed in 2022.

There is also the P16-billion 105-MW coal-fired power plant of subsidiary San Ramon Power Inc. (SRPI) in Zamboanga City.

The San Ramon plant will begin construction in 2021 and is scheduled to start operations in early 2024. The coal-fired plant will deliver supply to Zamboanga City and nearby areas.

ACR is in a long-term pivot to renewables with at least seven additional run-of-river hydroelectric plants in various stages of development. These include the 22-MW Siayan hydro plant in Zamboanga del Norte province and the 42-MW Bago hydro plant in Negros Occidental province.

Amid the pandemic, ACR executive vice president Tirso Santillan, Jr. had said their power facilities would continue to operate to serve the needs of about 8 million power consumers in 14 cities and 11 provinces in Mindanao.