Mirant admits IPO not ready this year

Mirant Philippines Corp., the country’s largest private power producer, has admitted it cannot push through with its initial public offering (IPO) this year.

During the memorandum of agreement (MOA) signing for the two new power plants to be put up in Aklan last Wednesday, Mirant Philippines president Edgardo Bautista said the company is not yet ready to undertake the public offering this year.

But Bautista reiterated that they have been preparing for such a move for the past months now. "We’re not ready but we’re working on it," he said.

The Philippine government, through the Department of Energy, has been prodding Mirant Philippines to issue about 10 to 15 percent of its shares in the Philippine Stock Exchange (PSE) as the company has been recognized as the country’s biggest revenue earner for the past two years.

Mirant Philippines, a wholly-owned subsidiary of US-based Mirant Corp., has been aggressively investing to put up several power projects in the country to justify its IPO plans.

Bautista said the company had to expand its presence in the Philippines to entice investors to buy its shares of stock once it decides to list in the stock exchange.

Mirant Philippines recently decided to invest about P600 million for a 12.5-megawatt power plant in Aklan to boost electric service in the province and avert the impending power shortage in the Visayas region.

It signed two electric power purchase agreements with Aklan Electric Cooperative (Akelco) to build and operate a 7.5-MW plant and a 5- MW facility in Nabas and New Washington towns, specifically to address the supply of power to the Boracay tourist spot. Both facilities will be operational by the first quarter next year.

For his part, Energy Secretary Vincent S. Perez said the additional generation capacity will help address the looming power shortage in Panay Island given its rapidly growing economy.

Perez said this will address the seven percent annual power demand growth in Aklan. For this year, he said, the power demand of Boracay island is expected to reach 22 MW.

Mirant’s 7.5-MW power plant will mainly supply the power requirements of Boracay while the 5-MW facility will provide electricity to other municipalities in Aklan, including Kalibo.

Aside from these two new power plants, Mirant Philippines also concluded negotiations for a 20-year, build-operate-and-own (BOO) energy supply contract with the Iloilo-1 Electric Cooperative Inc. (ILECO-1). Under the agreement, Mirant will finance, construct, operate and maintain a 10-MW diesel generating power station in Iloilo as well as rehabilitate and upgrade ILECO-1’s 13.2kV distribution lines in the municipalities of Sta. Barbara and Pavia.

Mirant Philippines, with Claredon Towers Holdings Inc., also acquired the 72-MW Panay Power Corp. from First Philippine Holdings and First Generation Holdings Corp. The acquisition involved the generation of an additional 40-MW capacity for the province of IloIlo.

The power firm has installed 2,000 MW of generating capacity nationwide. It also owns a share in the 1,200-MW natural gas-fired Iligan power plant. It also operates the Pagbilao and Sual coal-fired power plants and holds a 20-percent stake in the Ilijan natural gas-fired power plant.

It also recently ventured into other power facilities project in Toledo in Cebu.