Aboitiz ‘likely buyer’ of Ayala’s $1-B coal plant assets

Listed firm Aboitiz Power Corporation is inching closer as the “likely buyer” of the US$1.0 billion worth of asset representing 50-percent equity that has been set on sell-down by the Ayala Group on its coal-fired power facilities.

Sources from the banking community who are familiar with the developments on the transaction indicated that “negotiations are true” and one Aboitiz family member and key executive of the company “has been leading the acquisition deal.”

The anticipated merger and acquisition, according to sources, “will likely be concluded in the next few weeks.”

Aside from the “smiling emoji” that was sent by AC Energy President Eric T. Francia as response to media queries, there had not been confirmation or denial given by both camps.

As of this writing though, the entire power industry had been buzzing about the “forthcoming transaction” and how will that tie-up be impacting on the Aboitiz group’s market share limitation in the power industry.

Several companies had looked at the asset sale placed by Ayala’s power investment unit for auction as early as May. Deal with the buyer was initially targeted to close in June, but company executives said they needed more time to “assess” the offers.

The Ayala group said it has been targeting to corner a strategic partner that will own 50% equity on its thermal energy platform – the ACE Thermal Inc., which has an attributable capacity of 1,300 megawatts that are generally coal-fired plants.

AC Energy’s other assets are RE capacities – at roughly 300MW, comprising both of attributable capacities in the domestic market and its offshore ventures in Indonesia and Vietnam plus new acquisitions in Australia.

On equity sell-down at its thermal platform, the total value of the assets offered to interested parties had been pegged by brokerage firm CLSA at US$2.1 billion; hence, 50% of that will likely fetch proceeds of US$1.0 billion.

For the Aboitiz group, this will reinforce the stronghold it has on the Mariveles coal-fired power plants – its joint venture with the Ayala conglomerate.

The facility’s expansion units are currently at construction phases for the two-unit Dinginin coal-fired power plant venture, which will have total capacity of 1,376MW or 688MW capacity per block.