FIRST GEN CORP. on Monday said it entered into term loan agreements with BDO Unibank, Inc. (BDO) and Bank of the Philippine Islands (BPI).
The agreements specify that First Gen will borrow a total amount of P20 billion from BDO and BPI, the company said in a disclosure to the stock exchange.
The company said it intends to use the proceeds for its acquisition of the 165-megawatt (MW) Casecnan Hydroelectric Power Plant (CHEPP) and for other general corporate requirements.
CHEPP is a run-of-river type of power facility located in Pantabangan, Nueva Ecija.
“We are honored by and grateful for the confidence that the lenders have placed in First Gen,” First Gen Senior Vice-President and Chief Financial Officer Emmanuel P. Singson said.
He said the acquisition of CHEPP “is vital to our transition towards a decarbonized and regenerative future.”
At the bidding held in May, the Power Sector Assets and Liabilities Management Corp. secured the highest bid from Fresh River Lakes Corp., a wholly owned subsidiary of First Gen, with a price of $526 million. This was higher than the minimum bid price of $227.27 million.
The Casecan hydro plant was turned over to the government in 2021 following the expiration of the build-operate-transfer contract with the previous operator, Casecnan Water and Energy Co., Inc.
First Gen President and Chief Operating Officer Francis Giles B. Puno said in an interview in September that the company hoped to complete the financial closing and turnover of the hydro project by yearend.
“We at BDO remain committed to a sustainable future as we provide access to capital to renewable energy projects which BDO considers as a priority sector in financing,” said Charles M. Rodriguez, BDO executive vice-president and group head for Institutional Banking Group.
“First Gen will help in power generation in the community as it uplifts the lives of Filipinos while protecting the environment. Looking forward to a robust and longer-term business relationship with First Gen,” he added.
BPI Executive Vice-President and Institutional Banking Head Juan Carlos L. Syquia said the lending company is “committed to promoting sustainability and is always eager to support our clients’ sustainability initiatives.”
“We are glad to have done so by providing First Gen with more innovative financial solutions and improve the quality of life in the communities First Gen operates in and in the communities it serves,” he said.
For the third quarter, First Gen reported an attributable net income of $80.35 million, a 23% increase from $65.31 million a year ago.
Revenues decreased 16.3% to $603.93 million for the July-to-September period from P721.92 million previously.
At the local bourse on Monday, First Gen shares went down by 10 centavos or 0.55% to close at P18.20 apiece. — Sheldeen Joy Talavera