2 multilateral agencies invest in AC Energy

By Lenie Lectura – February 6, 2019
from Business Mirror

FOLLOWING the $225 million worth of green bonds raised last week, AC Energy Inc. announced investments from two large multilateral agencies last Monday night.

The power arm of conglomerate Ayala Corp. said the International Finance Corp. (IFC) provided an investment of $75 million.

IFC’s investment raises AC Energy’s five-year green bonds to $300 million. Last January 30, AC Energy raised $225 million. The five-year bonds carry a coupon rate of 4.75 percent per annum, and will mature in five years. It was listed on the Singapore Stock Exchange (SGX-ST).

AC Energy’s wholly owned unit AC Energy Finance International Ltd. issued the bonds, which were guaranteed by the former.

Moreover, Asian Development Bank (ADB) invested $20 million in AC Energy’s maiden climate-bond issuances.

This, after AC Energy completed a $110-million private placement of 10-year bonds with a coupon rate of 5.25 percent. The ADB is an anchor investor in the 10-year bonds that will also be listed on SGX-ST.

Both the five-year and 10-year bonds, totaling $410 million, are the first Climate Bond certified, publicly listed green bond in Southeast Asia. The certification provides assurance that the proceeds will be used to finance projects and assets that are consistent with delivering a low-carbon and climate-resilient economy. Proceeds will be used for AC Energy’s renewables expansion around the region including the Philippines, Indonesia and Vietnam.

“AC Energy’s inaugural public placement of green bond opens the door to a wider investor base and enables our renewable-energy investments. It also crystallizes our commitment to sustainable growth,” AC Energy President Eric Francia said.

Director General of ADB’s Private Sector Operations Department Michael Barrow said the green bond will contribute to Asean’s target of drawing 23 percent of its energy mix from modern, clean and sustainable renewable sources by 2025.

“AC Energy aspires to be a regional leader in renewable energy in Southeast Asia, and ADB is delighted to support the Ayala Group’s efforts to crowd in other investors,” Barrow said.

IFC, meanwhile, said its partnership with the Ayala group successfully mobilized substantial international investment in the public placement of AC Energy’s  five-year bond.

“This demonstrates the excellent potential of the green-bond asset class as a tool for mobilizing international institutional capital into infrastructure assets, and we look forward to expanding our support of such issuances across Asia, advancing the integration of regional power and financial markets,” IFC’s Director for East Asia and the Pacific Vivek Pathak said.

AC Energy said its green bond framework sets out well-defined guidelines for the use of proceeds for renewable- energy projects, with comprehensive monitoring and reporting commitments.

In 2018, AC Energy generated 2,800 GWh of attributable energy, of which 48 percent was from renewable sources. AC Energy’s 2025 goal is to reach 5 GW of renewable-energy capacity, with renewables contributing at least 50 percent of total energy output.