First Gen raises P10 billion from offshore bond offering

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Lopez-led First Gen Corp. has raised approximately P10 billion, or $250 million through an offshore bond issuance, of which the proceeds will be used to bankroll its power investments.

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A disclosure to the Philippine Stock Exchange showed on Thursday that First Gen successfully closed on Thursday its $250-million 10-year noncall 5 senior unsecured bond issuance. The bonds are traded on the Singapore Exchange Securities Trading Limited (SGX).

According to First Gen, it intends to use the proceeds of the offering for investments in power projects and general corporate purposes.

“The positive investor response to our international debt capital markets issuance highlights the strength of First Gen’s portfolio of power assets and its growth opportunities,” Francis Giles Puno, president and chief operating officer of First Gen, said.

Deutsche Bank, HSBC and J.P. Morgan served as the joint lead managers and joint lead bookrunners for the transaction. BDO Capital and Investment Corp. and the Development Bank of the Philippines served as domestic lead managers for the transaction.

The fund-raising was disclosed at the Philippine Stock Exchange a week ago by the First Gen, following the company’s announcement that it has mandated Deutsche Bank, HSBC and J.P. Morgan to arrange a series of fixed-income investor meetings in Manila, Hong Kong and Singapore.

First Gen priced on Thursday last week a $250 million 10-year noncall 5 senior unsecured bond issue at a fixed coupon of 6.50 percent per annum. The bond will mature on October 9, 2023.

The transaction, according to First Gen, garnered strong interest from offshore accounts in Asia and Europe, pricing tighter than initial guidance.

In the first half of the year, First Gen reported a net income attributable to equity holders of the parent of $77.7 million for the first semester ended June 30, 2013, a decline of 17.4 percent from the $94 million the firm registered in the same period of 2012.

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