SMC Global Power readies P30-B bond issue, gets top rating

SMC Global Power Holdings Corp. is returning to the bond market with a fresh offering of as much as P30 billion debt notes to partly repay loans and fund investments.

The loan obligations were incurred mainly to finance three acquisitions, including the acquisition of 100 percent interest of AES Phil Investment Pte. Ltd. in AES Transpower Private Ltd. and in AES Philippines Inc.

The bond issue, which represents the first tranche of the company’s three-year shelf registration of bonds worth up to P60 billion, was assigned the top credit rating of PRS Aaa by local credit watchdog Philippine Rating Services Corp.

Obligations rated PRS Aaa are of the highest quality with minimal credit risk. The issuer’s capacity to meet its financial obligations is extremely strong.

The bond issue was also issued a strong outlook, which means that the rating is “likely to be maintained or to remain unchanged in the next 12 months.”

In arriving at the rating, PhilRatings considered SMC Global Power’s leading market position, with a solid platform for expansion; strong support from parent firm San Miguel Corp., its stable profit and substantial cash flows, and its ideal position to capitalize on the growing demand for electricity in the Philippines.

SMC Global Power is one of the country’s leading and largest power companies, with a combined capacity of 4,197 megawatts as of the end of September 2018.

Its combined capacity of natural gas, coal and hydropower resources represents about 19 percent of the power supply of the national grid and 25 percent of the Luzon grid.

Through its wholly owned subsidiaries, SMC Global Power serves as the independent power producer administrator (IPPA) for the Sual, Ilijan and San Roque power plants.

The company’s power portfolio also includes the 218 MW Angat hydroelectric power plant in Bulacan, the 450 MW greenfield power plant in Limay, Bataan, the 300 MW greenfield power plant in Malita, Davao Occidental and the 684 MW Masinloc power generating facility in Masinloc, Zambales.