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First Gen unit gets $544 mln loan to refinance debts

Reuters | 11/11/2008 6:12 PM

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First Gas Power Corp, a unit of Philippine power producer First Gen Corp, has secured a $544 million term loan to repay its debt and that of its parent firm.

In a statement to Manila's stock exchange on Tuesday, First Gen said part of the loan would be used to repay its existing debt of $132 million. Another $215 million will go to First Gen to help it pay a significant portion of its maturing debts.

The company did not say how it would use the rest of the loan which consists of 10-year and 12.5-year maturities.

First Gen is the biggest privately owned power generation company in the Philippines with an installed capacity of 2,582 megawatts, accounting for about 17 percent of the country's total installed capacity.

Last month, First Gen said it needed $700 million to refinance debts it incurred in its $1.35 billion purchase last year of 60 percent of geothermal power producer Energy Development Corp.

Federico Lopez, president and chief executive of both First Gen and First Gas, said last month about $400 million of the total $700 million debt was due in November and the rest in 2009.

First Gen is looking at selling some of its assets to pay down debt. It agreed last month to sell a 40 percent stake in unit Red Vulcan Holdings, which holds its 60 percent interest in EDC, to a consortium led by Japanese trading firm Marubeni Corp.

First Gen last month sold a 60 percent stake in a hydroelectric plant operator to EDC for $105 million. 

First Gas said the term loan was signed with nine banks including Bank of Tokyo-Mitsubishi UFJ, ING Bank Singapore

as of 11/12/2008 11:00 AM