|
By Euan Paulo C. Añonuevo, Reporter
THE natural gas unit of First Gen
Corp. plans to borrow abroad through
the sale of IOUs, as part of the Lopez-controlled company’s
refinancing efforts.
In a disclosure to the Philippine
Stock Exchange, First Gen said its wholly owned unit Unified
Holdings Corp. is “contemplating/planning” an offering of debt
securities.
Unified Holdings owns a
60-percent stake in First Gas Philippines Corp., which operates the
1,000-megawatt Santa Rita and 500-megawatt San Lorenzo
combined-cycle natural gas-fired power plants. The remaining shares
are held by the London- and New York-listed BG Group.
First Gen said that Unified
Holdings is in preliminary discussions with several financial
institutions in connection with its fund-raising plan.
Francis Giles B. Puno, First Gen
chief finance officer, earlier said the company is planning to
refinance the bulk of its subsidiaries’ debts, the savings of $400
million from which will be used to pay off its long-term
obligations.
“We’re in the process of
firming [up] our short-term obligations by refinancing Sta.Rita and
San Lorenzo,” he said.
First Gen is eyeing to minimize
its debt to the $260 million convertible bond it issued earlier to
settle its sovereign obligations, while keeping the bulk of these
liabilities under its subsidiaries.
“Since they’re operating
companies there is a lot of interest from the bank[s] and bond
market with respect to the feasibility of refinancing debt at the
operating company [level],” he added.
First Gen said that Unified
Holdings has tapped Deutsche Bank AG-Singapore Branch and J.P.
Morgan Securities Ltd. to arrange a series of investor meetings in
Asia and Europe.
First Gen is the power generation
arm of the Lopez group. Its portfolio includes the country’s
largest natural gas-fed plants and the world’s second-biggest
geo-thermal energy provider, Philip-pine National Oil Co.-Energy
Development Corp. (EDC).
First Gen, through Red Vulcan
Holdings Inc., acquired EDC last year. Its foreign partner in Red
Vulcan however pulled out, forcing the Lopez-led firm to take over
the company.
Last week, First Gen said it
would sell the same stake in Red Vulcan to a separate foreign group.
For the first quarter of the
year, First Gen’s profits plunged by more than half to $16 million
on the back of higher interest expenses and tax payments.
Its shares closed lower Wednesday
at P33.5 from P34.0 previously.
|
