AC Energy Launches $400 mn Fixed for life Green Bond

AC Energy has successfully set the terms of its senior perpetual fixed-for-life green bond issuance at an aggregate principal amount of USD 400 million

Ayala Corporation’s energy platform, AC Energy has announced that it has successfully set the terms of its inaugural US dollar-denominated senior perpetual fixed-for-life (non-deferrable) green bond issuance at an aggregate principal amount of USD 400 million with a fixed coupon of 5.65 percent for life with no step-up and no reset, priced at par. This represents the first US dollar-denominated fixed-for-life green bond ever issued globally.

The Bonds will be issued by AC Energy Finance International Limited, a wholly-owned subsidiary of AC Energy, and will be guaranteed by AC Energy. The Bonds will be listed on SGX-ST and were certified under the ASEAN Green Bonds Standards by the Philippine Securities and Exchange Commission on 18 November 2019.

“We are very pleased to see the strong reception among bond investors for our maiden perpetual green bond, said Eric Francia, president and CEO of AC Energy. “We expect to add well over 1000 MW of renewables capacity in 2020, and this fresh capital will further cement AC Energy’s commitment towards renewable energy and sustainability, and will support the company’s scaling up of renewable energy investments in the Asia Pacific.”

The firm plans to deploy the funds for renewable energy expansion across the Asia Pacific region to include the Philippines, Indonesia, Vietnam, Myanmar, India and Australia, among others.

Cora Dizon CFO of AC Energy lauded the inaugural perpetual fixed-for-life green bond as a step towards widening the company’s investor base. “We recognise the fast-growing investor demand for green bonds, which we are leveraging to strengthen and diversify our sources of capital. The strong investor demand generated interest of over USD 1.2 billion and allowed the company to raise USD 400 million.”

As of November 2019, the firm has a net attributable capacity of over 1,600 MW, of which 600 MW is from renewable sources. As one of the fastest-growing energy companies with over USD 1 billion of invested and committed equity in renewable and thermal energy in the Philippines and around the region, it aspires to achieve 5 GW of attributable renewable energy capacity, and generate at least 50 percent of total energy output from renewables by 2025.