AC Energy Inc., the energy unit of conglomerate Ayala Corp., will issue green bonds worth $400 million to finance its renewable energy expansion into the Asia Pacific region.
Ayala disclosed to the Philippine Stock Exchange AC Energy it set the terms of the inaugural US dollar-denominated senior perpetual fixed-for-life (non-deferrable) green bond issuance with a fixed coupon of 5.65 percent for life with no step-up and no reset, priced at par.
The issue, which has received strong investor interest, represents the first US dollar denominated fixed-for-life green bond ever issued globally.
“We are very pleased to see the strong reception among bond investors for our maiden perpetual green bond,” said AC Energy president and chief executive officer Eric Francia.
“We expect to add well over 1,000 MW (megawatts) of renewables capacity by 2020, and this fresh capital will further cement AC Energy’s commitment towards renewable energy and sustainability and will support the company’s scaling up of renewable energy investments in the Asia Pacific,” Francia said.
AC Energy plans to use the proceeds from the bond issue to fund renewable energy expansion across the Asia Pacific region to include the Philippines, Indonesia, Vietnam, Myanmar, India and Australia.
AC Energy Finance International Ltd., a wholly-owned subsidiary of AC Energy, will issue the funds, with guaranty from AC Energy.
The bonds will be listed on Singapore Exchange Securities Trading Ltd. (SGX-ST) and were certified under the ASEAN Green Bonds Standards by the Philippine Securities and Exchange Commission on November 18.
The ASEAN Green Bonds Standards is an initiative that facilitates ASEAN capital markets in tapping green finance to support sustainable regional growth and meet investor interest for green investments.
It is part of the ASEAN Capital Markets Forum’s broader efforts in developing green finance for the region.
AC Energy chief finance officer Cora Dizon lauded the perpetual fixed-for-life green bond as a step toward widening the company’s investor base.
“We recognize the fast-growing investor demand for green bonds, which we are leveraging to strengthen and diversify our sources of capital,” Dizon said.
“The strong investor demand generated interest of over $1.2 billion and allowed the company to raise $400 million,” she added.