Aboitiz Power: We have enough funds for Asean expansion

Business Mirror

10 Sep 2014
Written by VG Cabuag

ABOITIZ Power Corp. said it has enough funds for its expansion in Southeast Asia as the company is aiming at further growing its business overseas due to the limited space offered at its home front.

Stephen Paradies, the company’s chief financial officer, said AboitizPower is looking at a combined 100 megawatts (MW) of power plants in the next few months. “We are looking outside [the Philippines]. Nothing very firm but some very good opportunities we are looking at Asean [Association of Southeast Asian Nations],” Paradies said at the sidelines of the company’s listing of P10-billion bonds at the Philippine Dealing & Exchange Corp.

Paradies said the company needs to go outside the country for expansion as its growth domestically is limited by the Electric Power Industry Reform Act of 2001. The law restricts ownership to just 25 percent of the national capacity and only 30 percent of each grid.

“So we’re getting close to that in places like Mindanao with our new plant. We want to grow and [we will look for opportunities] to grow outside,” he said.

AboitizPower and its parent firm Aboitiz Equity Ventures Inc. are both expanding to Southeast Asia and neighboring countries.

The power unit had previously explored the possibility of expanding in Papua New Guinea and Indonesia but nothing happened over a period of time.

So far, only Aboitiz group’s food unit Pilmico Foods Corp. was able to take a 70-percent stake in Vietnam’s aqua feed mill Vinh Hoan 1 Feed JSC for $19.6 million. It took over the company last month.

“Well, it’s important to know the right partner. So we got to do due diligence on the asset, on the partner. So it takes time. We will do project finance on the joint venture level,” Paradies said.

AEV reported a 20-percent decline in its net income for the first half of the year to P9.5 billion from last year’s P11.9 billion, as a result of the weakness in both its power and banking units.

AEV’s power unit contributes about 74 percent of the company’s income, banking at about 17 percent and the rest is shared by food and land-development units.   source