AC Energy raises $225 million from maiden green bonds

MANILA, Philippines — AC Energy Inc., the energy platform of the Ayala conglomerate, has successfully raised $225 million from its maiden green bond issuance which will bankroll its renewable energy portfolio expansion.

The inaugural US dollar-denominated senior green bond issuance has a five-year tenor and a coupon of 4.75 percent per annum, priced at 99.451.

AC Energy Finance International Ltd., a wholly-owned subsidiary of AC Energy, issued the bonds, a drawdown from the recently established $1 billion medium term note program.

The bonds will be listed on the Singapore Exchange Securities Trading Ltd. (SGX-ST).

“We are very pleased to see the success of our maiden green bond. This will enable AC Energy to scale up its renewable energy investments in the region,” said AC Energy chairman Fernando Zobel de Ayala.

“We are very encouraged by the strong reception among bond investors within the current volatile environment. This reflects confidence in AC Energy’s capability to execute its plans and meet investor expectations,” AC Energy chief financial officer Cora Dizon said.

The bonds have received certification under the Climate Bonds Standard (CBS) from the Climate Bonds Initiative (CBI), and will be the first publicly syndicated CBI-certified dollar-denominated green bond in Southeast Asia.

The CBS certification provides assurance that proceeds from any issuance of bonds will be used to finance projects and assets that are consistent with delivering a low-carbon and climate resilient economy.

AC Energy’s green bond framework sets out well-defined guidelines for use of proceeds for renewable energy projects, with comprehensive monitoring and reporting commitments.

In 2018, AC Energy generated 2,800 gigawatt-hours (GWh) of attributable energy, of which 48 percent was from renewable sources.

AC Energy’s 2025 goal is to reach 5GW of renewable energy capacity, with renewables contributing at least 50 percent of total energy output.

Based on its equity interest in power generation businesses, it owns approximately 1.7 GW of generation capacity in operations and under construction.

HSBC acted as sole global coordinator, Bank of America Merrill Lynch acted as sole green structuring agent, and BofAML, CLSA and HSBC acted as joint bookrunners and joint lead managers, with the participation of BDO Capital, BPI Capital Corp., and China Bank Capital as domestic managers.