SMC Global Power Holdings Corp. (SMC Global), the power unit of the San Miguel Group, may go forward with its initial public offering (IPO) by the third quarter of this year, San Miguel Corporation (SMC) President and COO Ramon Ang said.
“We are setting the IPO of San Miguel Power by the third quarter this year,” Ang said in an interview on Tuesday.
“We can’t determine it yet because the power business is not very bullish. Prices are low now but since we promised that we will go IPO, whatever the price or whatever the outlook, we’ll push through,” he explained.
In January 2014, Ang said they planned to raise as much as $1 billion from a maiden share sale of up to 49 percent of SMC Global Power, which owns San Miguel’s power plant ventures.
Eagle Cement Corp., the cement company also owned by Ang, is currently working on a planned IPO in May this year at a price of as much as 16 pesos per share. The IPO seeks to raise P9 billion in fresh funds to partially finance construction of a Cebu production hub.
Meanwhile, Ang said he is not letting go of the ailing Albay Electric Cooperative (Aleco), especially now that SMC’s Albay Power and Energy Corp. (Apec) is already turning positive after taking many hurdles to save Aleco. When Apec took over Aleco in 2014, it inherited Aleco’s P4-billion debt, which has now risen to P5.6 billion.
“Aleco is now doing well. We’ve already paid the price of our mistakes and suffered for several years,” Ang said.
“Every year we had to book a loss for telecom because we were still in the building phase. That is P7-10 billion a year. Aleco is the same and right now we’re profiting, unlike before,” he explained.
Meanwhile, Unit 2 of SMC’s Limay power plant will go fully commercial by July, he said.
“It’s undergoing flushing, leak checks, welding,” he said, adding that even during its testing phase, it can contribute to the grid already during the summer months.
“Limay plant even contributed when Malampaya went on maintenance shutdown even if it was on 100 percent diesel,” he said.
“The beauty of it is San Miguel is a merchant plant so we’re okay even if there are no off-takers or if prices are bad. San Miguel Group has no problem because we have other businesses like beer, or Pure Foods, or packaging,” he added.