Tuesday, January 11, 2011

San Miguel energy unit starts roadshow for $500-M bond issue

By Doris Dumlao
Philippine Daily Inquirer
First Posted 20:52:00 01/11/2011


MANILA, Philippines—San Miguel Energy Corporation, the power-generation holding firm of San Miguel Corporation, on Tuesday started a global roadshow to make itself known to investors in line with its bid to raise as much as $500 million from the overseas bond market.
Industry sources on Tuesday said San Miguel Energy, the first corporate issuer to brave the offshore debt market this year, might set a low 6-percent guidance on a prospective five-year issuance.
The company made a presentation to local investors during the Manila leg of the roadshow at the Edsa Shangril-La Hotel on Tuesday. Another roadshow will be conducted in Singapore on Wednesday, in Hong Kong on Thursday and London on Friday.
The unlisted and unrated power-generation holding unit would aim to raise between $250 million and $500 million from the offering of five-year bonds to the overseas market, San Miguel president Ramon S. Ang said earlier.
Industry sources said the issuance would be arranged by three foreign banks—HSBC, Australia New Zealand Bank and Standard Chartered Bank.
The five-year tenor, approximating the most liquid overseas Philippine government bond benchmark, is seen as a good maturity for San Miguel Energy’s maiden foray into the overseas debt market.
By sourcing some of its requirements from the offshore market, the power unit is seen avoiding the restrictive single-borrower’s limit that Philippine banks are required to keep.
The San Miguel group is raising funds in line with its transformation from a food-based into a power-based conglomerate. A recent P200-billion deal was hatched to buy from its ally, Global 5000 Investments Inc., a controlling stake in the San Roque hydroelectric plant, the coal-fired Sual power plant and the Ilijan gas plants.
San Miguel has bought a unit of Global 5000 that owns the controlling stake in the three power plants valued at P4.3 billion and will absorb the combined liabilities worth about P193 billion, other industry sources earlier estimated.

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