August 17, 2024 | 12:00am
MANILA, Philippines — State-run Power Sector Assets and Liabilities Management (PSALM) Corp. has secured P110 billion in syndicated loans from two government financial institutions to boost its capital and pay off debts.
In a statement, the Land Bank of the Philippines (Landbank) said it would finance P60 billion of the P110-billion syndicated term loan facility agreement to enhance the competitiveness of the local power industry.
The Development Bank of the Philippines will fund the remaining P50 billion.
The loan facility is expected to augment PSALM’s working capital requirements, refinance existing liabilities and settle domestic contractual obligations.
PSALM president and CEO Dennis Edward Dela Serna said the agency’s liability management program had significant challenges as it strives to liquidate its assumed financial obligations.
“This syndicated loan provides additional financial support to PSALM, ensuring our continued progress and assisting our asset management and privatization strategies,” de la Serna said.
“With this loan, we are projecting a net reduction of P12.9 billion in our financial obligations for this year,” he said.
Landbank president and CEO Lynette Ortiz said the bank has supported the government’s electrification initiatives, with its loan portfolio encompassing a wide range of energy-related projects.
The Landbank and the DBP acted as a joint lead arrangers for the syndicated deal.
PSALM is a wholly owned and controlled government entity mandated under the Electric Power Industry Reform Act to take over the ownership of all existing generation assets of the National Power Corp., independent power producer contracts, real estate, and all other disposable assets, including the transmission business of the National Transmission Corp.
It also manages the orderly sale and privatization of these assets to liquidate all of NPC’s financial obligations in an optimal manner.
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