NGCP may raise up to $2B from IPO

NGCP

The National Grid Corporation of the Philippines’ (NGCP) has increased the size of its planned initial public offering (IPO) to $1.5 billion (around $73.1 billion), though this may be raised further to $2 billion (around Php97.4 billion).

Based on a report by Bloomberg, NGCP has tapped Bank of America, JPMorgan Chase & Co., and UBS Group AG to handle the first-time share sale, according to its anonymous sources. The grid firm is also pursuing a valuation of $8 billion to $10 billion from the share sale which could happen in the fourth quarter.

At $1.5 billion, NGCP’s IPO would be the Philippines’ biggest ever, exceeding the $1.3 billion of Monde Nissin Corporation, which seeks to raise its upcoming first-time share sale. In 2013, Robinson Retail Holdings, Inc., raked in $621 million, the country’s largest IPO to-date.

Deliberations are still ongoing and the offering details such as size and timing could still change, added the sources. The said banks, meanwhile, refused to comment.

Last January, NGCP announced that it plans to raise $1 billion via the IPO. At that time, the transmission firm said the offer won’t be happening soon since market conditions weren’t ideal yet. 

Under Section 8 of Republic Act 9511 or NGCP’s congressional franchise, enacted in July 2008, the grid firm is required to make public at least 20% of its outstanding capital stock or within ten years from the beginning of its operations. NGCP officially began operations in 2009.

The IPO plan of NGCP follows the Energy Regulatory Commission’s (ERC) denial of its request to further extend the deadline for the share sale. Senate energy committee chairman Sherwin Gatchalian advised the ERC to issue the grid operator an ultimatum to comply with the requirement.

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