The Securities and Exchange Commission approved the P35-billion bond shelf registration of SMG Global Power Holdings Inc., a unit of conglomerate San Miguel Corp.
SEC commissioner Ephyro Luis Amatong said SMC Global’s bond shelf registration had an initial tranche of P20 billion to be issued in three series with tenors of five, seven and 10 years.
SMC Global has set indicative interest rates of between 5.375 percent and 5.75 percent for the five-year bonds, 6 percent to 6.25 percent for the seven-year bonds and 6.375 percent to 6.625 percent for the 10-year bonds.
SMC Global plans to issue the first tranche within the third week of December this year.
The power generator plans to use net proceeds from the bond offering to refinance the short-term loans extended by BDO Unibank Inc. and Philippine National Bank amounting to ₱20 billion
SMC Global has tapped BDO Capital and Investments Corp., PNBCapital and Investments Corp., Standard Chartered Bank, BPI Capital Corp., China Bank Capital Corp. and RCBC Capital Corp. as joint lead underwriters of the offering. The bonds will be registered with the Securities and Exchange Commission and listed with the Philippine Dealing & Exchange Corp.
This will be the second bond offering of SMC Global after raising P15 billion last year in fixed rate bonds due 2021, 2023 and 2026.
The company since last year has been paying its dollar-denominated debt to minimize the group’s exposure to foreign exchange losses brought about by the peso depreciation against the US dollar.
SMC Global this year paid $500 million out of a $700-million, five-year term loan by refinancing through peso-denominated loans.
SMC Global is one of the largest power companies in the Philippines controlling 2,903 megawatts of combined contracted capacity as of December 2015.
The power generation firm had a 17-percent market share of the power supply of the national grid and a 22-percent market share of the Luzon grid as of end December 2015.
SMC Global posted revenues of P62.1 billion in the first nine months 2017, up two percent year-on-year.
Operating income fell 14 percent to P19.7 billion, due to higher coal costs, replacement power purchases, lower bilateral volumes and the sale of the Limay co-generation plant last year.