Business Mirror
08 May 2014 Written by VG Cabuag
CONGLOMERATE San Miguel Corp. (SMC) is set to further delay the initial public offering of unit SMC Global Power Holdings Corp., citing poor market conditions.
“Our original plan is to go public for our power business. But since the market is currently weak, we just [have to] delay it further,” SMC President and Chief Operating Officer Ramon S. Ang told reporters.
Generation company SMC Global Power earlier planned to sell as much as 49-percent interest in the company to raise $1.5 billion, from both equity and private placement.
Ang did not provide a new time frame on the planned initial public offering but said timing is essential to raise more cash for the company. “The use of proceeds [from the IPO] has not changed. It will be for [SMC Global Power] and to pay our debts,” he said.
SMC Global Power originally filed to hold the IPO in August 2011, which was approved on the same year. At that time, the company said it plans to raise as much as P27.33 billion from the sale of 290 million to 385 million primary and secondary shares for about P44 to P71 per share.
The company has since delayed the IPO plan for several times, the latest of which was supposed to be held within the year.
In just four years SMC Global Power has become one of the largest independent power-generation companies in the country, with an installed capacity of 2,545 megawatts.
As of 2012 it accounts for a 17-percent market share in the national grid and 23-percent share in the Luzon grid.
Proposed $10-billion airport
AS this developed, SMC said it will build the planned $10-billion airport within Metro Manila, as the top executive said he expects to present the project to President Aquino within the month. Ang said his meeting with the President for the conglomerate’s presentation of its unsolicited bid to build a new airport was scheduled early next week.
“Our proposal will help our country as Manila can now be a hub and airfare will go down since, it will lower the cost of airlines coming into Manila,” Ang said. The said airport is expected to be operational on the fifth year with two parallel runways, and by the seventh year it will have four runways.
At the moment, the Manila’s 400-hectare airport only has one runway, both used for landing and takeoff. It can only accommodate 40 planes per hour, a far cry from Hong Kong’s Check Lap Kok airport that has two parallel runways and can accommodate 120 planes per hour.
“For now, we have not yet decided who will we choose as partner for the project but many are now taking interest,” Ang said. Earlier reports said the new airport will have an area of 800 hectares. The facility will initially be available exclusively for the use of SMC-owned Philippine Airlines, but later talks pointed to opening for other carriers.
With its single runway, the Ninoy Aquino International Airport (Naia) last year exceeded its maximum annual capacity of 30 million passengers.
Last year the Department of Transportation and Communications proposed to the President the option to build a new international airport that would be 25 to 30 minutes away from Naia. source
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