Ty power firm shelves IPO plan this year

MANILA, Philippines - The power generation arm of conglomerate GT Capital Holdings Inc. is temporarily shelving its plans for an initial public offering (IPO) this year.

New power generation projects are already adequately funded but Global Business Power Corp. (GBPC) is not ruling out a debut in the local bourse next year if there are new expansion, a company executive said.

“Not yet, not this year,” said GBPC director Alfred V. Ty when asked if the power producer would pursue its listing plan this year.

“There are a lot factors like taking into account the use of proceeds [and] new projects,” Ty said, adding that the company has to prepare new expansion plans.

In 2012, GBPC president Arthur Aguilar said the company might conduct an IPO as early as this year if new expansion plans are already finalized.

Since closing 2012 at 5,812.83, the Philippine Stock Exchange index has skyrocketed to 31 record highs this year, with the latest all-time high at 7,392.20 on May 15. But since then, foreign fund managers pocketed gains, pushing the main index down to 6,242.26 as of Friday.

Even without new fund-raising plans, power plants under construction are already fully-financed, Ty said.

In November, GBPC subsidiary Toledo Power Corp. broke ground for the 82-megawatt (MW) clean coal-fired power plant expansion project in Cebu. The same clean coal technology is being used in Cebu Energy’s 246-MW and Panay Energy’s 164-MW power plants.

GBPC owns coal- and bunker-fueled plants with a generating capacity of 633 MW mainly in the islands of Panay and Cebu.

Moving forward, GBPC aims to remain a key power industry player in Visayas and Mindanao.

“In the Visayas area, that’s where the immediate window [of opportunity] is for us,” Ty said.

GBPC is also studying business opportunities in electricity-starved Mindanao, which suffers from four to 12 hours of rotating brownouts during the summer season amid low output of hydropower plants.

“Of course there is a lot of [electricity] requirement in Mindanao and it’s something the group is studying,” Ty said.

Ty said the company would also have to take into account the logistics part because GBPC is now focused on projects in Visayas.

Asked if GBPC might list next year to support new projects, Ty said: “I wouldn’t close the door for that.”

In January, Meralco Powergen Corp., the power generation subsidiary of power distribution giant Manila Electric Co., teamed up with GBPC for four coal-fired power plants mainly in Mindanao.

Power producer GBPC posted P390.7 million in earnings in the first quarter, down from P498.1 million a year ago “attributed to lower peak power consumption and soft Wholesale Electricity Spot (WESM) Market prices during the first quarter of the year.”

Parent firm GT Capital of tycoon George S.K. Ty is also into banking (Metrobank), property (Federal Land), automotive (Toyota Motor) and insurance (Philippine AXA Life Insurance, which is a joint venture with the global insurance giant AXA Group).