EDC borrows P3.5 B for debt refinancing

MANILA, Philippines - Lopez-led Energy Development Corp. is borrowing P3.5 billion from Union Bank of the Philippines to refinance its existing debt.

EDC disclosed yesterday it executed a 15-year amortizing loan with UnionBank for a total amount of up to P3.5 billion.

“The facility will be used to refinance existing loans of the company,” it said.

Last week, EDC launched a tender offer for $100 million of $300 million 6.5-percent notes due 2022, which are listed on the Singapore Exchange Securities Trading Limited (SGX-ST).

The company accepted tender offers with an aggregate amount of $65.92 million at a purchase price of $1,110 per $1,000 principal amount as of April 5.

EDC will be accepting additional notes offers until April 10, which will be settled on April 12.

It has appointed Hongkong and Shanghai Banking Corp. Ltd. as dealer-manager for the offer.

“The purpose of the offer is to better manage currency risk and better optimize EDC’s debt maturity profile,” the company said.

The tender offer also gives noteholders the opportunity to gain liquidity, the company added.

Once acquired, EDC said the notes would be cancelled and would not be re-issued or re-sold.

Last year, its consolidated net income rose 24 percent from P7.86 billion in 2015 to P9.72 billion the previous year.

Meanwhile, core net income increased four percent from P8.8 billion to P9.2 billion due to improved performance and lower operating expenses of the Negros Island and First Gen Hydro business units.

Revenues for the period amounted to P34.2 billion, a slight decrease of P0.1 billion from the previous year, as depressed spot market prices for the Bacman and Nasulo geothermal plants’ uncontracted capacity offset gains in overall sales volume.