San Miguel Corp. to raise $700M from IPO of power unit

Philippine conglomerate San Miguel Corp. (SMC) is planning to raise $700 million from the planned initial public offering of its power generation subsidiary, San Miguel Global Power Holdings (SMGPH). “The equity value of our power generation company is $1.5 billion,” said SMC president and COO Ramon Ang on Thursday. “If we sell at least 49 percent, we will raise about $700 million.” Interviewed at the sidelines of Ginebra San Miguel Inc.’s annual stockholders meeting, Ang said they are now in talks with three bankers for the investment. SMGPH was originally scheduled to list with the Philippine Stock Exchange in 2011, but it was delayed because of the global financial turmoil brought about by the sovereign debt crisis in Europe. Based on the registration statement previously filed with the Securities and Exchange Commission, SMGPH had planned to offer between 348 million and 519.7 million in primary and secondary shares at P71 per share. Proceeds from the public offering will be used to acquire as well as to put up greenfield power projects. The power unit earlier said it plans to build four greenfield power projects in Cavite, Leyte, Bulacan and Davao worth P90.4 billion. Aside from the four greenfield projects, SMC Global Power said it intends to continue its strategic acquisitions of existing power generation capacity. Meanwhile, in the same interview, Ang said SMC is open to selling its stake in power retailer Manila Electric Co. if there is an offer. “We are not actively selling. But if you tell me that somebody or someone one wants to buy it come forward at that whatever price. I can easily decide on that in five minutes. I will give them terms” he said. — KBK, GMA News