BPI leads consortium raising $525M for AES Philippines’ Masinloc power plant expansion
MAKATI CITY — Bank of the Philippine Islands leads a consortium of Philippine banks that raised up to US$525 million to partially finance AES Philippines’ new 330-MW super-critical coal power plant envisioned to supply power to, among others, at least seven electric cooperatives in northern Philippines for 20 years, opening the way for a reduction in electricity rates in the area.
This facility follows a $500-million refinancing in 2013, also provided entirely by local banks, in support of the rehabilitation and modernization of the original 600-MW facility in Masinloc, Zambales. BPI’s investment banking subsidiary, BPI Capital Corporation, acted as sole issue coordinator and one of the joint lead arrangers for the transaction. This transaction underscores BPI’s commitment to finance and pursue projects that create a strong impact on sectors that are vital to the country’s economic growth.
AES is 50.55% owned by AES Corp., a leading American global power developer and operator, 41.35% by independent power producer Electricity Generating Public Co. Ltd. (EGCO) Group of Thailand and 8.10% by IFC. It is also the owner and operator of the existing 600-MW power plant in Masinloc, Zambales, considered to be one of the largest base-load clean-coal power plants in the Philippines. The partners intend to use the combined Masinloc platform as their vehicle for growth in the Philippines.
The facility is denominated in US dollars and has a tenor of 15 years, inclusive of an up to four-year grace period during construction and will be made available in fixed and floating interest rate tranches. The fixed-interest rate tranche shall be subject to a re-pricing on the eighth year anniversary to set the interest rate for the remaining seven years.
“We are happy to enable private sector operators such as AES Philippines to play a bigger role in delivering high-quality energy installations to address the increasing demand for electricity in the country,” said Reginaldo A.B. Cariaso, Officer in Charge and Managing Director of BPI Capital.
BPI Capital was recently cited by Finance Asia, a leading Hong Kong-based finance publication, as the Best Investment Bank and Best Equity Capital Market House in the Philippines for 2015. The other joint lead arrangers for this transaction are SB Capital Investment Corporation, RCBC Capital Corporation, and PNB Capital Corporation.
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