AC Energy increases green bonds offering to reach $470 million

AYALA-LED AC Energy, Inc. (AC Energy) upsized its senior green bonds offering under its $1-billion medium-term note program by $60 million, expecting it to boost its clean energy investments amid a grueling business environment.

In a stock exchange disclosure on Thursday, parent Ayala Corp. said the latest five-year bonds with a coupon of 4.75% annually, which were issued via private placement, bring the energy company’s total dollar bonds issuance to $470 million.

“AC Energy’s Green Bonds further strengthen our liquidity and enable us to continue scaling up our renewable investments despite the challenging environment,” AC Energy President and Chief Executive Officer Eric T. Francia said.

The senior bonds now consist of $360-million five-year bonds that are due in 2024 and $110-million ten-year bonds that will expire in 2029. The additional bonds will be listed at the Singapore Exchange Securities Trading.

The energy firm has tapped The Hongkong and Shanghai Banking Corporation Limited as the dealer for the bonds.

AC Energy started the bonds program in 2019, the first Climate Bond Initiative-certified dollar-denominated green bonds listed in Southeast Asia. These were supported by the International Finance Corp. (IFC) and the Asian Development Bank (ADB).

The company later in November raised $400 million from the fixed-for-life bonds.

In the first quarter, AC Energy set aside around $455 million of the proceeds from the perpetual green bonds to 11 power projects with a combined capacity of 1,600 megawatts (MW) in Vietnam, Indonesia, and the Philippines. These include its latest greenfield projects and the purchase of additional stakes in Philippine energy projects.

AC Energy was recognized for its issuance as the Best New Green Bond Issuer by London-based IFC. The offering was recognized as the Best Green Bond and the company as the Best Issuer for Sustainable Finance (Corporate) in the Philippines by Hong Kong’s The Asset.

Further, the perpetual bond was awarded Best Corporate Bond in Asia Pacific by The Financial Times-run The Banker.

Earlier, the company made a bold commitment to divest from coal in the next decade as part of its updated environmental and social policy, while it pledged to scale up its renewables expansion in the region.

It is currently building several solar projects with a total of 180 MW in capacity in the Philippines and over 200 MW of both solar and wind facilities in Vietnam.

The company is seeking to widen its renewables capacity to 5,000 megawatts by 2025.

On Thursday, shares in Ayala Corp. inched up 0.71% to close at P780.50 each. — Adam J. Ang