ACEN launching green bonds

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AC Energy (ACEN) announced that it launched its green bonds to be listed on the Singapore Exchange (SGX).

In a disclosure to the Philippine Stock Exchange (PSE), ACEN said that the senior guaranteed undated notes to be issued by subsidiary ACEN Finance Limited will be part of a US$1.5 billion Medium-Term Note Programme, which was granted an approval in principle by the SGX last August 26.

The Ayala-led firm said the size and terms of the notes, which it would guarantee, would be fixed on a later date.

“ACEN’s Green Bond Framework is in accordance with the Green Bond Principles issued by the International Capital Markets Association. On August 25, 2021, the Philippine Securities and Exchange Commission (SEC) confirmed that the Notes comply with the requirements under the ASEAN Green Bonds Circular and qualify as an ASEAN Green Bond Issuance,” the disclosure read.

The notes are not and will not be registered with the SEC, as these will not be sold in the Philippines. Any future offer or sale of the securities in the country is subject to the registration requirements under Republic Act 8799 or the Securities Regulation Code, unless such an offer or sale counts as a transaction exempt from these requirements.

Though the note will be sold on foreign soil, US citizens are ineligible from purchasing the securities. Transactions of the notes may also not take place in American territory.

ACEN investors seemed to be delighted with the announcement, as its stock price went up by 4.24% or Php0.39 to Php9.59/share in the PSE on Tuesday. The company’s stock was also the seventh most-traded in the local bourse for the day.

Based on Investopedia’s definition, a senior note is a type of bond, which precedes over other debts in case a company declares bankruptcy and is forced into liquidation.

Green bonds, meanwhile, are particularly meant to raise capital for projects that would help fight climate change.

AC Energy has been actively building capital since the onset of 2021, having raised Php5.37 billion from the stock rights offer in January and another Php13.1 billion from its follow-on offer in May. In March, Singaporean sovereign fund GIC Private Limited made an Php11.88 billion private placement. Together with the green bond offer, these form part of the firm’s target of having 5,000 megawatts in its renewable energy (RE) portfolio by 2025 and become Southeast Asia’s largest listed RE platform.

Aside from Ayala, Lopez-led Energy Development Corporation (EDC) is selling green bonds worth Php15 billion to fund its geothermal expansion projects, but this was approved by the SEC.