Philippines: Marubeni unit Axia buys Ayala thermal power plant

Philippines: Marubeni unit Axia buys Ayala thermal power plant

Axia Power Holdings Philippines Corp, a wholly-owned subsidiary of
Japan-based trading firm Marubeni, has acquired a 20 per cent stake in South
Luzon Thermal Energy Corp (SLTEC) owned by conglomerate Ayala Corp.

Axia Power made the deal on December 20, acquiring stakes of Ayala's two
units in SLTEC, namely AC Energy Holdings Inc, and Phinma Energy, who both
sold 5 per cent, and 15 per cent stake, respectively.

AC Energy is a 100 per cent subsidiary of Ayala, while Phinma is AC Energy's
joint venture partner in SLTEC.

SLTEC owns and operates a 2 X 135-MW thermal power plant in Calaca,
Batangas. The plant operates as a baseload plant to meet the power demand in
Luzon.

With Axia Power, Ayala expects SLTEC thermal power plant to become more
technically and financially capable to undertake larger projects in the near
future.

The agreement brings Phinma Energy's ownership in SLTEC to 45 per cent, and
AC Energy's to 35 per cent.

Financial details of the transaction between Axia Power and AC Energy were
not disclosed.

However, Phinma informed the local bourse that it sold over 3.5 million
SLTEC shares to Axia Power priced at P234.93 apiece, or a total of $16.8
million (P841.7 million).

AC Energy president and CEO John Eric Francia noted Marubeni group has
extensive experience in thermal power and this should further strengthen
their joint venture.

"The partial sale also allows AC Energy to reinvest more aggressively in new
projects as we pursue our 2020 goal of reaching 2000MW," Francia said.

Meanwhile, Phinma Energy president and CEO Francisco Viray said the Marubeni
group investment in SLTEC conveys strong validation of confidence in SLTEC's
management team, as well as in the future prospects for reliable and
efficient plant operations.

"PHINMA Energy will continue to offer SLTEC's full output, in line with the
company's growth aspirations as a licensed Retail Electricity Supplier
(RES)," Viray said.

As a global power asset investing company, Axia Power develops new
investment opportunities for power assets, and also manages and holds
existing power generating assets. It claims on its website of owning 20
power generating assets in 10 countries worldwide and has gained traction in
Asia, Australia, Africa, American Region, and the Middle East Region.

Phinma's last trading price went up 5.83 per cent or P0.120 to close at
P2.18.

Ayala last traded at P715 per share on December 20, which was down by 1.72
per cent or P12.50 per share from Monday.

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Link to Original Article:
http://www.dealstreetasia.com/stories/philippines-marubeni-unit-axia-buys-ay
alas-thermal-power-firm-61013/

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John Diecker
APT Consulting Group Co., Ltd.

www.aptthailand.com