SMC Global Power Holdings, the power arm of San Miguel Corporation (SMC), is looking to issue Php30 billion worth of bonds, with an oversubscription of up to Php10 billion as part of its three-year shelf registration program.
The amount is part of the company’s first tranche of the shelf registration program worth Php60 billion, the Philippine Ratings Services Corporation (PhilRatings) said in a statement.
PhilRatings gave the company’s bond issuance an issue credit rating of PRS Aaa, which is the highest credit rating in the long-term issue credit rating scale. It also gave a “Stable Outlook” rating as the bond issuance is “likely to be maintained or to remain unchanged in the next 12 months.”
PhilRatings identified SMC Global Power’s key strengths in the bond issuance, which include: “a leading market position, with a solid platform for expansion; strong parent Company support; the stability of earnings and substantial cash flows, supported by the long-term offtake contracts of the Company, albeit margins are declining; and its conservative capital structure considering a capital-intensive industry.”
The company is currently installing 690 megawatts (MW) in battery energy storage systems (BESS) capacity this year. It is also in the process of developing liquefied natural gas (LNG) power plant projects in Batangas, Negros Occidental, Cebu, and Leyte.
SMC Global Power is the country’s second-largest power generating company (genco), currently with 4,856MW in installed capacity, based on data from the Department of Energy. It also has 4,734MW of committed capacity as of March 31. Based on data from the Energy Regulatory Commission, meanwhile, San Miguel’s genco accounts for 19% of power used by the national grid nationally.
