SEC okays hike in authorized capital of Salcon International

The Securities and Exchange Commission has approved an increase in the authorized capital stock of Salcon International Inc. (sister company of listed energy firm Salcon Power Corp.) from P12 million to P750 million.

Salcon International was awarded by the Bohol provincial government the authority to rehabilitate, own, and operate the Bohol provincial electric system.

Out of the firm’s new authorized capital, P63 million has been subscribed. The increase was made to cover additional working capital requirements.

Salcon Power, is majority owned by Salcon Philippines Inc., a 60-percent subsidiary of Singapore’s Salcon Ltd., along with other foreign entities and local partners led by Dennis and Larry Villareal, Alfredo Henares, Yolanda Martirez and Cora Gamez.

Salcon Power offered to the public 313.9 million common shares early this year. The shares were listed on the first board of the Philippine Stock Exchange.

Proceeds from the offering were used by the company to partially finance its investment in the $27-million (roughly P1.4 billion) Eight Islands diesel project to be implemented by its wholly-owned subsidiary, Salcon Island Power Corp.

The project, sponsored by the National Power Corp., involves the development of bunker-fired diesel generating set power plants with an aggregate capacity of 50 megawatts on a build-own-and operate scheme in eight designated islands, namely Palawan, Masbate, Marinduque, Catanduanes, Sulu, Cebu, Romblon and Tawi-Tawi.

Salcon Power is currently negotiating with a German financial institution for a dollar-denominate project loan payable over a six-year period with interest pegged at the London interbank offered rate (Libor) plus 1.2 percent.

The firm’s flagship and initial venture in the Philippine power industry is the 203.8-megawatt Naga power plant complex in Cebu bid out by Napocor in 1994 for a 15-year rehabilitation, operation, maintenance and management (ROMM) agreement.

Since then, Salcon Power has extended its participation in other power projects in the country such as its acquisition of 40 percent of Mactan Electric Co., a power distribution franchise in Lapu-Lapu City, Olango and Cordova in Mactan, Cebu; and a five-megawatt generating facility in Samal Island, Davao under a joint venture with Davao del Norte Electric Cooperative. – Zinnia Dela Peña