Regulator clears Filinvest unit's power supply contract with Davao electric cooperative

The Filinvest Group has secured regulatory approval of its power supply contract with the electric cooperative of Davao Oriental.

In a ruling, the Energy Regulatory Commission (ERC) cleared the power purchase deal between FDC Misamis Power Corporation and Davao Oriental Electric Cooperative Inc (Doreco).

Under the agreement, Doreco will buy six megawatts (MW) from FDC Misamis’ 405-MW coal-fired power project at the PHIVIDEC Industrial Estate in Misamis Oriental for 15 years.

The additional supply would allow Doreco to meet its forecast demand from 2014 to 2028. The electric cooperative sources 5.4 MW from state-owned hydropower plants, contracts for whic expire in 2016.

Doreco also sources 6 MW from the Aboitiz Group's power barges.

FDC Misamis and Doreco agreed to a P4.72 per kilowatt-hour (kWh) rate, which would redound to a reduction of P0.41 per kWh in the electricity bills of the cooperative’s customers. But after excluding some proposed costs, the ERC approved a lower rate of P3.33 per kilowatt-hour, which is "within the level among the recently approved rates for coal-fired power plants in the Philippines."

The P43 billion coal project of FDC Misamis is slated for commission next year.

The company previously secured contractual commitments from 17 electric cooperatives, including Doreco, for the project's first two 135-MW generating units.

FDC Misamis is a wholly-owned subsidiary of FDC Utilities Inc, the upstart power generation unit of Filinvest Development Corporation.

Doreco distributes electricity to the city of Mati and the municipalities of San Isidro, Manay, Cateel, Lupon, Gov. Generoso, Caraga, Boston, Banaybanay, Tarragona, and Baganga in Davao Oriental.

- Interkasyon

Security Bank bags BSP approval of partnership with Hong Kong life insurer

The Bangko Sentral ng Pilipinas (BSP) has approved the partnership of Security Bank Corp and Hong Kong-based Pacific Century Group's insurance arm.

In a disclosure to the Philippine Stock Exchange, Security Bank said it received the approval of the central bank on the lender's request for the authority to cross-sell FWD Life Insurance Corp's products through a bancassurance arrangement.

Security Bank sealed an exclusive partnership with FWD Life last October, allowing the regional insurer to offer life insurance products to the bank's customers.

The partnership is expected to derive synergies from Security Bank's distribution platform and FWD Life's innovation and expertise.

The Insurance Commission last April granted FWD Life a license to operate in the country, making it the first foreign life insurance company in nearly a decade to enter the Philippine market.

The permit comes after the insurer put up the P1-billion capital that the government requires. On top of that, FWD Life is spending P300 million for its operational expenses, having hired 40 so far for its Philippine venture.

Pacific Century Group is the private investment firm of Richard Li, son of Asia's richest man, Li Ka-Shing.

- Interaksyon

Robinsons Land earnings pick up in 2014

Robinsons Land Corp (RLC) bucked a first-half slowdown, with earnings rising at a slightly faster clip in its 2014 fiscal year despite slower revenue growth.

In a disclosure to the Philippine Stock Exchange, the Gokongwei-owned real estate developer said net income rose 5.8 percent to P4.73 billion in its fiscal year ending September 2014, faster than the 5 percent growth to P4.48 billion in the previous year.

RLC's full-year 2014 performance marks a turnaround from lower earnings in the first half of the same fiscal year due to losses related to Typhoon 'Yolanda' and the fire at Robinsons Galleria mall.

Total gross revenues increased 7 percent to P17.05 billion, slower than the 18 percent expansion to P15.90 billion in 2013.

The commercial centers division accounted for P8.10 billion of real estate revenues, nearly a tenth higher compared to the P7.39 billion in 2013. RLC said Robinsons Magnolia, Robinsons Palawan and Robinsons Iloilo led the growth while most provincial malls also posted decent growth in rental revenues. The five newly opened malls also contributed to the increase in revenues.

Revenues of the residential division advanced 5 percent to P5.87 billion from P5.58 billion in 2013 as more buyers met the equity requirement of 15 percent in recognizing sales based on percentage of construction completion.

The office buildings division posted a 7 percent rise in revenues to P1.54 billion from P1.44 billion the previous year due to the addition of Cyberscape Alpha and Cyberscape Beta, with occupancy rates of 46 percent and 68 percent, respectively, at end-September 2014.

Revenues of the hotels division were flat at P1.53 billion as against the P1.50 billion in 2013. The increase was attributed to new Go Hotels in Iloilo and Ortigas that opened during the year.

RLC is pouring P15-17 billion in the fiscal year ending September 2015, higher than the P14.1-billion spending last year. The company plans to sell P12 billion worth of fixed rate bonds to bankroll capital expenditures and settle obligations.

RLC is part of JG Summit Holdings Inc, the Gokongwei family’s holding firm for its businesses in food and beverage, real estate development, air transportation, petrochemicals and banking. The conglomerate also has investments in Manila Electric Co and Philippine Long Distance Telephone Co.

- Interaksyon

Metro Pacific Group bags deal to build bridge connecting Cebu and Mactan

The Metro Pacific Group has secured clearance from the local government of Cebu to construct a third bridge connecting it to neighboring Mactan Island.

Ramon Fernandez, president of Metro Pacific Tollways Corp (MPTC), told InterAksyon.com that Cebu Mayor Mike Rama already signed the acceptance of the company's proposal to build a bridge linking Cebu City and Cordova town.

"Our estimate of the start of construction of the project is anywhere between 6 and 9 months from notice of award," Fernandez said.

He said the proposed bridge, which will span 7.9 kilometers -- to include the main bridge, an 800-meter viaduct, the toll plaza and a causeway -- will cost about P17 billion.

The management of the proposed bridge would be turned over to the city after 35 years.

Fernandez earlier said the company was targeting more road projects in the Visayas and Mindanao.

The Metro Pacific Group, which corners 60 percent of the Philippines' toll road industry, operates the North Luzon Expressway (NLEX), Subic Clark Tarlac Expressway and the Manila Cavite Expressway.

Fernandez had said the company is investing P36-40 billion over the next three to five years for its projects.

MPTC also plans to construct the P18 billion road connecting NLEX to the South Luzon Expressway (SLEX).

The NLEX-SLEX Connector Road, which will be called Segment 10.2, would be integrated to Segment 10.1, a 5.65-kilometer road that starts where Segment 9 ends on MacArthur Highway and stretches all the way to C3 Road. Segment 9 is a 2.4-kilometer portion linking the NLEX to MacArthur Highway.

The three projects once completed would be called NLEX Metro Expressway Link Project. The P1.59-billion Segment 9 is expected to be completed in March, while the Segment 10.1 would follow.

Segment 10.2 is an eight-kilometer long road from C3 in Caloocan City to Polytechnic University of the Philippines (PUP) campus in Sta. Mesa, Manila. Some portions of this segment will be elevated above the railroad tracks of the Philippine National Road (PNR).

- Interaksyon

Megaworld to expand office space leasing business

Megaworld's Iloilo business park perspective

Megaworld Corp is accelerating its office space launches within the next three to five years.

Megaworld senior vice president Jericho Go said the company is bringing to the market over 100,000 square meters of office space within its township projects.

"On an annual basis, we have set a minimum of 100,000 square meters [in terms of launches]. Hopefully by January after the corporate planning conference, we've bumped up our 100,000 to 150,000 or something better. Moving forward, that will be the trend," Go said during an interview before the holiday break.

Megaworld added 112,000 square meters to its office space portfolio to close 2014 with 712,000 square meters upon completion of Towers 1 and 2 in Uptown Bonifacio and of projects in Mactan Newton and Iloilo Business Park, according to analyst estimates.

Megaworld has launched roughly 60,0000 to 75,000 square meters of office space in the last 3-5 years, Go said, adding that its office projects in its township developments in Metro Manila as well as Cebu and Iloilo are mostly fully leased out.

Go said the take up of office space in recent years has been “phenomenal” with a lot of business process outsourcing (BPO) companies entering into pre-commitment deals with developers, something "unheard of in terms of office space."

"If they don't do that now, they will be left behind. It's possible that their competitors will be taking that space to begin with. If that happens they will be left fighting for limited space at a higher price. Prudence dictates ‘I sign up for this space now, I pay now and lock in the price,’" Go said.

Megaworld nearly tripled its earnings to P19.03 billion at end-September buoyed by an P11.62-billion non-recurring gain, strong residential sales in its various townships, and higher leasing income from its office and retail portfolio.

Megaworld is part of Alliance Global Group Inc, the holding firm for billionaire Andrew Tan’s real estate, consumer goods, quick service restaurants, hotel and gaming businesses.

- Interaksyon

8990 Holdings raising debt early next year

8990 Holdings Inc plans to take on fresh debt early next year to finance its expansion.

8990 Holdings president Januario Jesus B. Atencio last week said the low-cost mass housing developer may raise at least P5 billion through the issuance of corporate bonds or notes in the first half of 2015.

Proceeds from the debt issuance will fund project development, landbanking initiatives, retirement of higher-interest bearing loans and engineering capacity expansion.

"I have already increased capacity by 33 percent in the third quarter from 8,000 units to 10,500 units. I need to increase to 15,000 units to be safe. I'm trying to hit it by first quarter of next year,” Atencio said.

Early this year, 8990 Holdings raised P9 billion from a follow-on offering that attracted Malaysia’s state investor Khazanah Nasional Berhad and private equity firm TPG Capital (S) Pte.

8990 Holdings entered the local bourse via the backdoor through its takeover of IP Converge Data Center Inc.

8990 Holdings likely grew earnings by 38-48 percent to P3-3.2 billion this year fuelled by strong demand for its residential projects. Revenues are projected to increase to P7.6-7.8 billion, up 41-46 percent from P5.36 billion a year ago.

8990 Holdings had targeted to launch 12 new projects this year, bringing 11,574 units to the market with a total area of 105 hectares. At end-August, the real estate firm had rolled out nine of those developments in the National Capital Region, Cavite, Angeles, Cebu, Iloilo and Davao.

- Interaksyon

Happy New Year! #2015

Happy new year everyone!
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