Tepco-Marubeni seeks bank loans to finance purchase of Mirant assets
Monday, January 15, 2007
The consortium of Tokyo Electric Power Company and Marubeni Corporation (Tepco/Marubeni) are now in deep negotiations with the Japan Bank for International Corporation (JBIC) and Japanese commercial banks on the amount of loan they would secure for the acquisition of Mirant Corporation’s assets in the Philippines.
"The amount of loan is still being decided by the parties in the negotiations process," noted Marubeni Philippines Corporation president Federico E. Puno when asked by reporters.
Even with the US$ 1.3 billion financing being offered by Credit Suisse, Mirant’s advisor in the sale of its equity shares, the Tepco/Marubeni group elected to firm up a financing deal with Japanese lending firms.
"We opted not to exercise that option," Puno said, emphasizing though that when they have submitted their bid to Mirant, they have shown firm evidence of availability of funds for the equity shares’ purchase.
The Tepco/Marubeni group submitted an unmatched bid of $ 3.4 billion, including discount rates. The cash portion was placed at $ 3.1 billion.
Puno affirmed that financial closing is expected by the middle of this year, as the timeline is contingent to the scheduled resumption of commercial operations of the generation units 1 and 2 of the 1,200-megawatt Sual coalfired power station in Pangasinan.
While working on various transition requirements, it was noted that the Tepco/Marubeni consortium is simultaneously finalizing plans to consolidate the various corporate vehicles set up by Mirant to operate its Philippine power generation portfolio.
It was stressed that several companies are involved in the management and operation of its Philippine assets, including those in Bermuda, Delaware and Atlanta in the US, some subsidiaries in Europe and the regional Mirant Asia Pacific Ltd. in Hong Kong. (MMV)
For now, the burden of the acquiring consortium is somehow eased because of the support being extended by the Philippine government for them to have a smoother transition as they work on the preconditions for the turnover of the assets.
While not formally sought, the Philippine government as represented by the National Power Corporation, already indicated of giving its consent for the Marubeni/Tepco group to acquire Mirant’s Philippine assets.
It would be noted that the government had despised the arrogant stance of Mirant when it opted to bypass NPC’s consent in the sale process.
Marubeni is already considered a well-entrenched player in the Philippine power industry, thus, the government has at least more confidence that it can fully deliver in its commitment to operate the acquired assets efficiently and reliably. (MMV)
posted by philpower @ 12:29 PM,
