PSALM to borrow up to $1.5B to refinance Napocor debt

The Power Sector Assets and Liabilities Management Corp. (PSALM) may raise up to $1.5 billion to refinance debts of the state-owned National Power Corp. (Napocor) maturing next year. Outgoing PSALM President Jose C. Ibazeta told reporters the final amount and the borrowing structure would still be determined by market conditions. "We really have to rely on the market. The final decision will be made once the market is ready for it," Ibazeta said. Ibazeta assumed the leadership of the Energy department last Friday after Secretary Angelo T. Reyes declared his bid to run as party-list representative of a transport group. "I can tell the number but the final decision is made always when the market is ready for it. It could be $500 million or $1.5 billion," Ibazeta said. The fund-raising will cover $1 billion worth of Napocor loans due next year, he said. "We’re looking at peso financing, securities, maybe another bond issuance," he added. The $1-billion refinancing will be on top of the P50-billion borrowing approved by the Bangko Sentral ng Pilipinas last month. PSALM said earlier this year it planned to borrow P20 billion to cover the power generator’s maturing debt. PSALM is the government body that manages the sale of the state’s power assets. It also handles the Napocor’s liabilities. Last May, it sold to the international bond market $1 billion worth of bonds due in 2019. — Jose Bimbo F. Santos, BusinessWorld