Meralco raises funds for expansion this year

Manila Times.net
Published : Friday, January 06, 2012 00:00 Written by : Euan Paulo C. Añonuevo REPORTER


MANILA Electric Co. (Merlaco) said that it has raised fresh funds for expansion plans this year.


In a disclosure to the Philippine Stock Exchange (PSE), Meralco said that it raised P3 billion from the issuance of seven-year and 10-year fixed rate notes in December with a group of financial institutions and insurance companies.


Meralco earlier said that the proceeds of the borrowing would be used to put up new substations, power lines and service improvement projects this year.


“The Meralco notes were well-received by the market with an oversubscription over the planned issue size of P3.0 billion,” Roberto Juanchito Dispo, First Metro Investment Corp. (FMIC) president said.


FMIC acted as arranger and underwriter of the transaction.


The Meralco seven-year and 10-year notes were fixed at a yield of 5.5346 percent and 5.6387 percent per year, respectively.


The company also plans to raise about P20 billion for its share in a coal-fired power plant it is putting up in Subic together with Aboitiz Power Corp. and Taiwan Cogeneration International Corp.


Power distribution companies like Meralco, whose franchise area contributes nearly half of the country’s economic output, are allowed by regulators to source electricity from their own plants provided they do not go beyond half of their total requirements.


Meralco’s shares closed at P263 apiece on Thursday, down from P264 in the previous trading day.