SMC power unit’s IPO gets SEC approval

business mirror

THURSDAY, 08 SEPTEMBER 2011 21:51 MIGUEL R. CAMUS / REPORTER

The Securities and Exchange Commission (SEC) has approved the P33.5-billion initial public offering of SMC Global Power Holdings Corp., the power unit of conglomerate San Miguel Corp. (SMC).

SEC Commission Secretary Gerard Lukban said by phone the IPO was approved during the corporate regulator’s full court or en banc session on Thursday. Details were not immediately available.

SMC Global Power’s initial prospectus filed earlier showed 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 by the company to build new power plants and to bid for government power assets up for privatization.

SMC Global Power tapped as international lead managers and bookrunners Goldman Sachs (Singapore) Pte., Standard Chartered Securities (Singapore) Pte. Ltd. and UBS AG. ATR KimEng Capital Partners Inc. and SB Capital Investment Corp. were hired as domestic underwriters. Standard Chartered acted as financial manager to the deal.

Having entered the power sector in 2009, SMC Global Power 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 is the independent power-producer administrator for the Ilijan natural-gas power plant in Batangas, the San Roque multipurpose hydroelectric plant in Pangasinan and the coal-fired Sual plant in
Pangasinan. The facilities have a combined contracted capacity of 2,545 megawatts (MW).

At present, the company is in the advanced stages of planning two start-up clean-coal power projects with a combined capacity of 450 MW alongside plans to bid for selected generation plants, the prospectus showed.

Moreover, SMC Global Power is pursuing the vertical integration of its power interests through complementary businesses. The company has already acquired coal-production and -exploration rights covering 17,000 hectares of property in Mindanao.

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.