SMGP eyes P17.7-B offshore debt issuance

SAN MIGUEL Global Power Holdings Corp. (SMGP), the power generation unit of conglomerate San Miguel Corp. (SMC), is returning to the offshore debt market with approval to issue $300 million (P17.67 billion) in senior perpetual capital securities.

The proceeds will primarily fund pre-development and capital expenditures for solar, hydropower, and battery energy storage projects, while excluding coal-fired and liquefied natural gas assets, the company said in a filing with the Philippine Dealing & Exchange Corp. on Monday.

The board of SMGP approved the offering and appointed Standard Chartered Bank as sole global coordinator. Joint lead managers include Australia and New Zealand Banking Group Ltd., Deutsche Bank AG (Singapore Branch), The Hongkong and Shanghai Banking Corporation Ltd. (Singapore Branch), and Standard Chartered Bank.

DB Trustees (Hong Kong) Ltd. will serve as trustee, while Deutsche Bank Aktiengesellschaft, Hong Kong Branch will act as paying, calculation, transfer, and registrar agent. Latham & Watkins is engaged as listing agent.

The proposed securities will be listed on the Singapore Exchange Securities Trading Ltd.

Proceeds will cover costs and expenses related to exchange offers and the issuance of additional new securities. Excess funds are earmarked for pre-development of solar and hydropower projects and capital expenditures for battery energy storage systems.

“For the avoidance of doubt, the net proceeds will not be applied in connection with any of the corporation’s existing and planned coal-fired power assets and/or liquefied natural gas assets (including, but not limited to, their construction and working capital requirements),” SMGP said.

The company is also inviting eligible holders of its US dollar-denominated senior perpetual capital securities issued on Jan. 21, 2020, which carry a 5.7% interest rate, to exchange them for new securities on an equal principal amount basis.

SMGP operates a diversified energy portfolio spanning conventional and renewable sources. — Sheldeen Joy Talavera