First Gen raises $250M from dollar bond offer

Business World Online

Posted on October 03, 2013 11:20:59 PM

By Claire-Ann C. Feliciano, Reporter

FIRST GEN CORP. has raised $250 million from a dollar bond issuance, the proceeds of which will be used for investments in power projects.

First Gen is looking to use proceeds from the bonds for power projects. -- AFP

The Lopez-led holding company, in a disclosure, said it had priced the bonds, which will mature on Oct. 9, 2023, at 6.50% per annum.

It said Deutsche Bank, HSBC and J.P. Morgan were joint lead managers and joint lead book runners for the transaction, while BDO Capital & Investment Corp. and Development Bank of the Philippines served as domestic lead managers.

“Yes, it’s done,” HSBC President and Chief Executive Officer Jose Arnulfo A. Veloso yesterday said when asked to confirm the offering.

“The transaction garnered strong interest from offshore accounts in Asia and Europe, pricing tighter than initial guidance,” First Gen said.

“The proceeds from the issue will be used to invest in power projects and general corporate purposes,” it added.

Further details were not immediately available.

First Gen said in May that it was planning to tap the debt market to fund the second phase of its San Gabriel natural gas power project in Batangas. The company then said it was considering all options, including syndicated loans and issuance of dollar or peso bonds.

The San Gabriel project, which involves a facility with total capacity of 1,300 megawatts, is to be constructed in three phases beginning this year at a cost of $1.4 billion. Commercial operations are targeted to start in 2018.

First Gen, the holding company for the Lopez Group’s power generation businesses, saw its net income sink by 30.65% to $116.042 million in the first half from the $167.320 million recorded in the same period last year.

The firm’s shares lost 30 centavos or 1.82% to close at P16.20 apiece yesterday from P16.50 on Wednesday.   source