Published December 6, 2018, 10:00 PM
By Myrna M.
Velasco
Power utility giant Manila Electric
Company (Meralco) is intending to secure new loans to refinance P11.5 billion
worth of notes falling due next year.
According to Meralco Chief Financial
Officer Betty Siy-Yap, the notes were issued in 2013 with a seven-year
maturity, but there is a put option for it in 2019.
She indicated the company is now
exploring several options on the planned refinancing of the facility –
including prospective long-term loan procurement.
The recourse being weighed by the
power firm will include tapping preliminary into internal funds to settle such
obligation or tap short-term financing.
Yap explained though that short-term
financing “could be very expensive,” hence, that might not exactly be the
direction they would be heading to.
She added long-term refinancing will
be most beneficial, but she emphasized that accessing such facility would
require them to apply for a debt-to-equity (D/E) ratio with the Energy
Regulatory Commission.
Nevertheless, she qualified that
while the company preps on to securing regulatory approval on a D/E ratio,
tapping into internally generated cash could be the immediate possibility.
“We will apply for a D/E ratio, but
while waiting for ERC approval, we may tap into our internal funds,” Yap said.
The utility firm is still at its
pace of aggressive expansion – primarily in upgrading and enhancing the
capacity of its distribution network.
And while the regulatory go-signal
on their capital expenditures (capex) application had just been partially
granted, Yap indicated that they have been continually seeking separate
approvals for emergency capex.
For the first half this year, she
said the company already rolled out P3.0 billion worth of emergency capital
outlay, and that had so far been ramped up to P4.0 billion.
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