SMC Global Power to issue $100 million securities

MANILA, Philippines — SMC Global Power Holdings Corp. (SMCGP), the power unit of San Miguel Corp. (SMC), is eyeing to issue additional securities worth at least $100 million partly to shore up its investment in a gas plant.

In a regulatory filing, SMC Global said the board approval is subject to prevailing market conditions and as may be advantageous to the corporation.

“The net proceeds of the additional securities will be used and applied by the corporation primarily for investments in the 1,313.1 (megawatts) MW Batangas combined cycle power plant and related assets or for general corporate purposes,” it said.

Last July, SMC Global said it was gearing up to build a 1,300-MW liquified natural gas (LNG) combined cycle plant in Batangas City, which will provide clean and stable power to Manila Electric Co. over the next 20 years, beginning 2024.

The facility will provide power at a very competitive price, cheaper than what modern coal plants in the country currently offer.

Following a competitive selection process in February, SMC Global’s subsidiary Excellent Energy Resources Inc. signed a power supply agreement with Meralco which would provide 1,200 MW from a natural gas-fired power plant with an all-in headline rate of P4.7450 per kilowatt hour (kWh) and computed all-in levelized cost of electricity of P4.8849 per kWh by Nov. 26, 2024.

The plant is part of SMC Global’s plans to ramp up its renewable energy and cleaner power investments to reduce its carbon footprint while helping address the country’s need for reliable and affordable power.

The additional securities will be consolidated with the corporation’s existing $600 million senior perpetual capital securities issued last June to form a single series.

For the new issuance, the company engaged Standard Chartered Bank and Mizuho Securities Asia Ltd.  as joint lead managers, DB Trustees (Hong Kong) Ltd. as trustee; Deutsche Bank AG - Hong Kong Branch as paying agent, and Latham & Watkins as listing agent.