Fundraising

Blackstone to sell stakes in Filipino power plants for $1.2bn

Aboitiz Power, one of the largest power producers in the Philippines, has beat competition from other investors for two power assets with a combined capacity of 1.94GW.

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A subsidiary of Aboitiz Power Corporation will acquire interests in two power assets in the Philippines held by Blackstone-managed investment funds for $1.2 billion. 

Aboitiz said it will purchase a 66.1 percent interest in the 604MW Mariveles Coal Plant and a 40 percent stake in the 1,336MW coal-fired Dinginin power station through Therma Power. Therma Power is Aboitiz Group’s investment vehicle in non-renewable energy. 

The two power assets are currently parked under GN Power, a joint venture between Blackstone-owned power producer Sithe Global and Filipino conglomerate Ayala Corporation. Sithe Global is held by a number of investment funds affiliated with Blackstone, such as Blackstone Capital Partners, Blackstone Family Investment Partnership and Blackstone Energy Partners. 

Aboitiz said yesterday it had been chosen as the preferred bidder for the acquisition. It was reported that other bidders included the Kuwait Investment Authority, private equity firm CVC Capital Partners, a consortium led by Singapore sovereign wealth fund GIC, Malaysian power company Malakoff Corporation and an infrastructure fund managed by Macquarie. 

The Filipino power producer has secured a $650 million loan from six banks to partially finance the acquisition. The banks include the Bank of Tokyo-Mitsubishi UFJ, DBS Bank, HSBC, Maybank Kim Eng Securities, Mizuho Bank and Standard Chartered. The rest will be funded via internally generated cash. 

The transaction is subject to the approval of the Philippines Competition Commission and the Board of Investments.  

“We consider this acquisition very strategic as it give us immediate earnings from the operating asset and incremental capacity in the coming years from the plant under construction and its expansion. We are likewise looking forward to the completion of our pipeline projects, which include more baseload capacity as well as renewables,” said Erramon I. Aboitiz, chief executive of Aboitiz Power, in a statement. 

Aboitiz aims to increase its net sellable capacity to 4GW by 2020.