Gov’t may reconsider plan to scrap loans for Napocor

The government might reconsider its earlier decision to cancel plans to tap the international debt market for fresh borrowings this year of up to $750 million for state-run National Power Corp. (Napocor).

The $750-million is the uncovered portion of Napocor’s financing requierements of about $1 billion this year.

"We will be willing to do it for Napocor if it makes economic sense," said Finance Secretary Jose Isidro Camacho.

However, he said there is no pressure or urgent need for either Napocor or the National Government to go to the debt market immediately. "We will tap the market if we get a good price and market conditions are favorable," Camacho added.

The Finance chief said government has received a number of proposals from various foreign financing companies to arrange the loan for Napocor, but these are constantly being assessed.

Napocor withdrew plans this week to float $500 million worth of global bonds. This after it turned out there were questions about the structure of the bond offering and pricing for the seven-year bonds were unfavorable.

This was supposed to be the second time the National Government would be borrowing for Napocor, considered an unattractive issue because it is up for privatization with huge debts to be borne largely by government.

The seven-year bonds were being arranged by sole bookrunner Bear, Stearns & Co. in conjunction with JP Morgan and primarily targeted US investors. – Rocel Felix