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MANILA, Philippines – Diversified conglomerate San Miguel Corp. (SMC) is now considering a combination of equity sale and initial public offering (IPO) of its power generation arm to raise about $1 billion in the first quarter of 2014.
San Miguel president and COO Ramon Ang told reporters on Tuesday, October 9, that the IPO target schedule for SMC Global Power Holdings Corp. is now “definite.” SMC Global’s IPO has been in the pipeline since 2011.
“We will definitely go for listing in the PSE (Philippine Stock Exchange). We are very confident that we would be able to do it quickly. For sure, it will happen,” said Ang after the signing ceremony between SMC Global Power Holdings Corp. and Albay Electric Cooperative (ALECO).
“The latest would be in the first quarter of next year,” he added.
He said that aside from the planned listing, the group is also in talks with prospective foreign and local firms keen on buying 39% stake of SMC Global, a key player in the Philippine power sector. (INFOGRAPHIC: Top power players in the Philippines)
“We hope to do a 49% deal: 10% will be IPO and 39% to the investor,” Ang revealed. He said the company has yet to identify how to spend the $1 billion target proceeds from the fund raising exercise. It earlier said the company is keen on funding greenfield power projects.
By December, San Miguel will have chosen the buyer for the 39% SMC Global stake. “Once we choose our partner in December, the IPO won’t take longer than three months,” said Ang.
SMC Global Power’s maiden share sale was originally scheduled in the last quarter of 2011 but the brewing global financial crisis and the sovereign crisis in Europe led it to shelve its listing plans.
In May, Ang said they are negotiating with 3 banks for a cornerstone investor in SMC Global. The sale of a 49% stake was estimated to fetch about $700 million back then.
In its previous registration statement with the Securities and Exchange Commission, the company planned to offer between 348 million and 519.7 million in primary and secondary shares at P71 per share.
SMC Global has a power generation capacity of 2,500 megawatts (MW) and an equity value of at least $1.5 billion. It wants to beef up its capacity by 3,000 MW more. – Rappler.com
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