International Finance Corp. and the Asian Development Bank invested $95 million in AC Energy Inc.’s green bonds.
AC Energy, Ayala Corp.’s energy platform, said the bonds were issued through AC Energy’s wholly-owned subsidiary, AC Energy Finance International Ltd., and guaranteed by AC Energy.
IFC provided an anchor investment of $75 million to complete the public placement of AC Energy’s five-year green bonds. AC Energy raised a total of $300 million from Philippine and international investors.
The additional $75 million of five-year bonds with a coupon of 4.75 percent will be listed on the Singapore Stock Exchange. The initial $225-million issuance was listed on January 30.
AC Energy also completed a $110-million private placement of ten-year bonds with a coupon of 5.25 percent with ADB as one of the main investors with an investment of $20 million. The ten-year bonds will also be listed on SGX-ST.
“We are proud to support AC Energy, a key member of our long-term strategic client Ayala Corp., in greening its power generation portfolio by helping fund its aggressive growth in renewable energy. We are delighted that our partnership, leveraging IFC’s extensive global experience in green bonds, successfully mobilized substantial international investment in the public placement of the company’s 5-year bond,” IFC director for East Asia and the Pacific Vivek Pathak said.
“This demonstrates the excellent potential of the green bond asset class as a tool for mobilizing international institutional capital into infrastructure assets, and we look forward to expanding our support of such issuances across Asia, advancing the integration of regional power and financial markets,” Pathak said.
IFC, a member of the World Bank Group, is a pioneer in green bonds since 2005 and has invested $22.2 billion in long-term financing of climate-related projects and mobilized another $15.7 billion from third-party investors.
AC Energy will use the proceeds from the recent bond issuances to expand its renewable projects around the region including the Philippines, Indonesia and Vietnam.
Both the 5-year and 10-year bonds totaling $410 million are the first climate bond certified, publicly listed US dollar green bond in Southeast Asia.
The certification provides assurance that the proceeds will be used to finance projects and assets that are consistent with delivering a low-carbon and climate resilient economy.
“This green bond will contribute to Asean’s target of drawing 23 percent of its energy mix from modern, clean and sustainable renewable sources by 2025,” said Michael Barrow, director-general of ADB’s private sector operations department.
“AC Energy aspires to be a regional leader in renewable energy in Southeast Asia, and ADB is delighted to support the Ayala Group’s efforts to crowd in other investors,” he said.
“We are delighted to partner with IFC and ADB, as AC Energy further strengthens its Environmental, Social, and Governance standards in managing its energy investments,” said AC Energy president and chief executive Eric Francia.
He said AC Energy was fully committed to environmental responsibility, biodiversity protection and greenhouse gas reduction by scaling up renewable energy initiatives across Asia-Pacific.
“AC Energy’s inaugural public placement of green bond opens the door to a wider investor base and enables our renewable energy investments. It also crystallizes our commitment to sustainable growth,” Francia said.