SMC Global Power raises $400 million from perpetual securities

MANILA, Philippines — SMC Global Power Holdings Corp., the power unit of San Miguel Corp. (SMC), has issued $400 million worth of perpetual capital securities, proceeds of which will be used for its liquefied natural gas (LNG) initiatives.

The company said the securities were issued last Wednesday with an initial rate of distribution of 7.00 percent per annum.

It has obtained in-principle the approval for the listing and quotation of the securities from the Singapore Exchange Trading Ltd (SGX-ST).

Net proceeds of the issuance will be used for capital expenditure and investments in LNG gas facilities and related assets, as well as for refinancing of the company’s expiring debt or perpetual securities and for general corporate purposes.

In January, the company raised $600 million from the issuance of senior perpetual capital securities in Singapore with an initial rate of distribution of 5.7 percent per annum.

SMC Global is in advanced stages of executing the binding terminal use agreement term sheet for the proposed LNG terminal in Batangas, with AG&P to provide receiving, storage and regasification services to the Ilijan power plant.

“The planned Ilijan LNG Terminal will be developed by AG&P LNG Terminals and Logistics, with EPC (engineering, procurement and construction) work handled by AG&P Construction Solutions,” SMC Global said.

SMC Global said it has negotiated “priority status” for the Ilijan LNG Terminal over all projects of AG&P LNG projects.

“As the foundation customers, SMC’s power plants will also be the priority terminal users for the terminal and its capacity,” it said.

The terminal is expected to be commercially operational by June 2022, in time for the expiration of the Ilijan independent power producer-administrator (IPPA) contract.

SMC Global, through its subsidiary South Premiere Power Corp., is the IPPA of the Ilijan plant output.

In the first half this year, SMC Global posted a 25 percent growth in net income to P9.06 billion from P7.26 billion in the same period last year.