Aboitiz Equity raises P6.1B from sale of treasury shares

Aboitiz Equity Ventures Inc. (AEV), the listed investment holding company of the Aboitiz family, said it raised about P6.1 billion (approximately $124 million) from the sale of its treasury shares.

In a disclosure to the Philippine Stock Exchange (PSE), AEV said it has successfully placed its entire treasury shares holdings representing 742.51 million shares at P8.20 per share.

The offer price represents a discount of 5.7 percent to the share price close of P8.70 on Jan. 26, 2007.

AEV said 92 percent of the offering was taken up by foreign investors while the balance of eight percent was subscribed by domestic investors.

"The offering saw high quality demand from approximately 60 institutional investors in the US, Europe and Asia which will significantly increase the company’s free float and further strengthen AEV’s shareholder base," the company said.

UBS Investment Bank acted as sole book runner in the transaction while ATR Kim Eng served as the domestic lead manager.

Proceeds from the sale will be used to fund various greenfield power projects, as well as support its participation in the privatization of the National Power Corp.’s (Napocor) power plants as they become available.

The group also hopes to raise funds through the equities market with the maiden offering of shares of Aboitiz Power Corp., which will become the holding company for its power generation and distribution assets upon completion of a corporate restructuring.

Aboitiz Power is eyeing an IPO within the first quarter of the year.

The group needs $270 million to finance the purchase of the 360-megawatt Magat hydroelectric power plant in Ramona, Isabela. AEVI together with partner SN Power, the second largest hydropower producer in Europe with over 14,000 MW capacity, won the bidding for Magat in December last year with a bid of $530 million.

It is also joining the auction to supply power in Sibulan and Tamugan, both in Davao, which would require the construction of a combined 72 megawatt hydroplant — Sibulan (42 megawatts) and Tamugan (30 megawatts). About P8 billion to P9 billion will be needed for these two projects.

Bidding for the Sibulan plant will take place in the first week of February this year. Assuming it wins, the AEV group plans to start construction of the plant within the first half of the year.

The group is also interested in bidding for the Ambuklao plant in Benguet which has been slated for auction by the government sometime this year.

Aside from this, the group is also eyeing the Masinloc power plant.

The Aboitiz Group, through its wholly owned subsidiary HEDCOR Inc., is the pioneer and industry leader in the development, operation and management of hydropower plants.

HEDCOR Inc. is the largest developer of mini hydropower in the Philippines, operating 19 generating facilities in Benguet and Davao with 113 megawatts of total installed capacity.