Power generation firm eyes up to $50M from additional debt

Business World Online

Posted on October 25, 2013 07:20:07 PM

FIRST GEN Corp. plans to raise up to $50 million by selling more of an existing bond issue, the Lopez-led firm said in a disclosure Friday.

"Please be informed of the reopening of First Gen’s…6.5% senior notes due October 2023. The re-opening size will be up to the amount of $50 million," the disclosure read.

Such "reopening" involves sale of additional amounts of a previously issued bond, with same maturity date and interest rate as the original debt, but with a different issue date and price based on prevailing market yields.

Company officials were not immediately available for comment.

Last Oct. 10, First Gen reported that it closed its $250-million 10-year bond offer -- priced at 6.5% per annum -- intended for investments in power projects and for corporate spending. The company said the bonds, traded on the Singapore Exchange Securities Trading Ltd., will mature on Oct. 9, 2023. First Gen tapped Deutsche Bank, HSBC and J.P. Morgan served as joint lead managers and joint lead bookrunners for the transaction, while BDO Capital & Investment Corporation and Development Bank of the Philippines were domestic lead managers.

First Gen had 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 built in three phases beginning this year at a cost of $1.4 billion.

First Gen is the holding company for Lopez Group’s power generation businesses. It owns and operates several power plants with total installed capacity of 2,763 MW.

The company saw its net income sink 30.65% to $116.042 million in the first half from $167.320 million in the same six months last year. Revenues fell 4.22% to $984.615 million from $1.028 billion, while cost of sale of electricity dropped 5.5% to $651.706 million from $689.666 million. 

First Gen shares shed two centavos or 0.12% to close P16.36 apiece on Friday from P16.38 each on Thursday. -- Claire-Ann Marie C. Feliciano  source