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SMC power unit OKs sale of securities worth $500m

The board of SMC Global Power Holdings Corp. approved Tuesday the issuance of up to $500 million in undated senior perpetual capital securities to finance battery energy projects and other general corporate activities.

SMC Global Power said the new securities would be in addition to the outstanding $500 million in senior capital securities issued on April 25, 2019, $300 million in senior perpetual capital securities issued on July 3, 2019 and $500 million in senior perpetual capital securities issued on November 5, 2019.

“The net proceeds from the issuance of the securities will be used and applied by the corporation for the development and completion of its battery energy storage systems (BESS) projects and for general corporate purposes,” the company said in a report to the Philippine Dealing & Exchange Corp. on January 7.

The company plans to put up BESS in several areas in  Bulacan, Cagayan de Oro, Caticlan, Iloilo, Isabela,  Ilocos Norte, Albay, Leyte, Bataan,  Davao Occidental, Cebu, Pampanga, Mindoro, San Roque/San Manuel, Butuan, Zamboanga, Navotas, Negros Occidental, Cagayan, Compostela Valley,  Zambales, Misamis Oriental, Rizal, Samar, Tarlac and Pangasinan, Zamboanga del Sur and Bohol.

The securities will be constituted by a trust deed by and between the corporation and DB Trustees (Hong Kong) Ltd. as trustee. They will be listed on Singapore Exchange Securities Trading Ltd.

SMC Global engaged Credit Suisse (Hong Kong) Ltd., DBS Bank Ltd., JP Morgan Securities PLC, Mizuho Securities Asia Ltd., Standard Chartered Bank and UBS AG Singapore Branch as joint lead managers, DBS Trustees (Hongkong) Ltd. as trustee and Deutsche Bank AG, Hong Kong Branch as paying agent.

SMC Global Power, along with its subsidiaries, associates and joint ventures, is one of the largest power companies in the Philippines.

It has a diverse portfolio of fuel sources, including natural gas, coal, hydro and recently BESS.

SMC Global Power is controlled by conglomerate San Miguel Corp. which joined the power industry in 2009 following the acquisition of rights to administer the output produced by independent power producers in privatization auctions conducted by the government.

San Miguel’s IPPAs  include the Sual coal-fired power plant in Sual, Pangasinan, San Roque hydro plant in San Manuel, Pangasinan, and the Ilijan natural gas power plant in Ilijan, Batangas.

An IPP administrator has the right to sell electricity generated by the power plants owned and operated by the relevant IPPs, without having to bear any of the large upfront capital expenditures for power plant construction or maintenance.

Topics: SMC Global Power Holdings Corp. , senior perpetual capital securities
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