Alsons to raise funds for power business

Manila Times.net

ALSONS Consolidated Resources Inc. has obtained board approval to conduct a placement and subscription transaction to raise funds for the expansion of its power-generation business in Mindanao.

In a disclosure to the Philippine Stock Exchange, Alsons Consolidated said it will hold an equity offering worth $175 million, or P7.5 billion inclusive of over-allotment shares, subject to favorable market conditions.

Major shareholders Alsons Corp. and Alsons Development and Investment Corp., which own 41.21 percent and 18.89 percent of the listed firm will offer to sell a portion of their shares through marketed placing to investors outside the United States and qualified institutional buyers within the US.

To a limited extent, the equity offering will also be offered in the domestic market to qualified buyers and not more than 19 persons who are not qualified buyers.

The sale proceeds will be applied as payment on the two shareholders’ subscription to an equivalent number of new common shares to be issued out of Alson Consolidated’s unissued authorized capital stock.

CLSA Limited was appointed as sole global coordinator, book runner and stabilization agent for the proposed transaction.

The number of offer shares and the final selling price will be determined following a book building exercise.

The proceeds will finance the construction of a 200-megawatt coal-fired power plant in Maasim, Sarangani and another 100-megawatt facility in Zamboanga City. They are expected to come on stream in 2014 and 2016.

The firm will spend $750 million for the two projects, which will increase its capacity from 155 megawatts to 455 megawatts in the next five years.

In anticipation of the Sarangani project, the board approved the direct ownership of Sarangani Energy Corp., presently owned by a subsidiary, to be used as the corporate vehicle that will own and operate the new power plant.

The board also approved the direct ownership of Kamanga Agro-industrial Ecozone Development Corp., which will own and operate the Kamanga Agro-Industrial Ecozone where the power plant will be located.

In a separate disclosure, Alsons Consolidated also secured board approval for the subscription of Alsons Corp. or its nominees to 5.5 billion redeemable preferred voting shares with a par value of P0.01 per share.

This will be taken out of the reclassification of 55 million unissued common shares with a par value of P1, which is pending regulatory approval.

In the first quarter, the company’s profit climbed 58 percent to P343 million on higher energy fees.

Its shares rose to P1.44 on Thursday from P1.34 on Wednesday.

Krista Angela M. Montealegre