Published April 4, 2017, 10:01 PM By Myrna M. Velasco
SMC Global Power Holdings Corporation, the power generation investment unit of San Miguel Corporation, will push through with its planned initial public offering (IPO) this year.
This was indicated to the media by SMC President and Chief Operating Officer Ramon S. Ang, with him stressing that since it had been committed previously by the company, it will now have to live up to it.
“Probably by third quarter this year, we will do the listing – IPO for San Miguel Power,” he stressed. The company’s stock offering had been planned years back, but in the process, SMC Global Power opted to work first on its project completions.
Asked on prospects relative to SMC Global Power’s listing, Ang qualified that he cannot give a categorical assessment for now given the current developments in the industry wherein margins for power generation companies have been decimated due to oversupply concerns and intensifying competition that had been pulling down power prices.
“The power business is no longer as bullish as before. For now, prices in the market have been going too low,” he said. Ang reiterated though that since the company already made known its stock listing plan, “we’ll have to go ahead with it, whatever the price will be, we will still do the IPO.”
SMC is currently the country’s biggest power producer – combining the force of its power assets acquisition from the divestments undertaken by the government as well as the greenfield projects it is currently bringing to completion phases.
“If the share price offer for San Miguel Power will be low, it will still be advantageous to the investors, because that could prospectively go up in the next two years,” Ang said.
The power assets that the San Miguel group had acquired from the government were either through direct sale or for it enlisting as Independent Power Producer Administrator (IPPA) of the supply contracts of facilities still under build-operate-contract (BOT) with the National Power Corporation (and subsequently transferred to the Power Sector Assets and Liabilities Management Corporation).
The new builds, on the other, included its 140-megawatt co-generation power facility for its Petron refinery; the 300MW Malita coal-fired power plant in Davao; 600MW Limay coal-fired plant; and the planned 600MW Mariveles power facility in Bataan.