SMC power unit targets mid-November IPO

BUSINESS MIRROR
SUNDAY, 11 SEPTEMBER 2011 21:01


SMC Global Power Holdings Corp., the power unit of conglomerate San Miguel Corp., is targeting to complete by the middle of November what could be the Philippines’ biggest IPO valued as much as P35.5 billion, individuals privy to the company’s plans said.


“It should be completed by November 15. The target is still this year,” a deal arranger for the IPO said; a second underwriter confirmed the target timeline.


But both informants requested anonymity as SMC Global Power has yet to release a formal schedule for the IPO.


The initial public offering had been approved by the Securities and Exchange Commission (SEC) although the final registration statement has yet to be released, pending final adjustments required by the corporate regulator, an SEC official said last week.


An initial prospectus filed by SMC Global Power showed that the company plans to sell from 300 million to 500 million primary and secondary common shares priced from P44 each to P71 each.


Proceeds from the IPO would be used to build the company’s new power plants and to bid for government power assets up for privatization.


SMC Global Power joined the power sector in 2009 and is now considered one of the country’s biggest power producers. Through its portfolio, the company controls a 17.5-percent market share of the national grid’s power supply and a 23.5-percent market share in Luzon alone.


SMC Global Power said it is in the “advanced” stages of planning two startup clean coal-power projects with a combined capacity of 450 megawatts (MW) alongside plans to bid for selected generation plants, the prospectus showed.


SMC Global Power is the independent power producer administrator for the Ilijan natural gas power plant in Batangas, the San Roque multipurpose hydroelectric plant in Pangasinan, the coal-fired Sual plant in Pangasinan. The facilities have a combined contracted capacity of 2,545 MW.


The company is also planning additional greenfield projects having an aggregate capacity of up to 3,000 MW in five to seven years.


SMC Global Power said sales in the six months to June almost doubled to P35.2 billion. Net income during the period hit P2.7 billion, up 176 percent.


SMC Global Power is on track to be the fourth company to go public this year, after supermarket chain Puregold Price Club Inc. and electronics maker Cirtek Holdings Philippines Corp. complete their initial share sales this month.