Lao renewable firm EDL-Gen prices Thai baht bonds to help fund acquisition

The transaction showcases EDL-Gen’s strong credit positioning as well as the depth of the Thai debt capital markets

EDL-Generation Public Company (EDL-Gen), the leading electricity producer in Lao People’s Democratic Republic, on July 4 announced the pricing of its upcoming Thai baht bond offering of up to 17.50 billion baht (US$527.60 million) to help fund its expansion plans.

The offering comprised of six tranches with the three-year bond priced with a coupon of 3.90% per annum, five years (4.50%), seven years (4.85%), 10 years (5.50%), 12 years (6%) and 15 years (6.25%).

Praset Deejongkit, senior vice-president and manager for corporate finance at Bangkok Bank, one of the joint lead arrangers for the transaction, describes the 6.25% coupon for the 15-year bond as a good yield from an electricity generation company.

The transaction showcases EDL-Gen’s strong credit positioning as well as the depth, breadth and liquidity of the Thai debt capital markets. The bonds are to be offered to institutional investors and high net worth individuals (HNWIs) with the subscription period set for July 10-12. This will EDL-Gen’s third bond offering in Thailand with the objective of broadening its investor base as it targets the HNWIs.

As Laos’ major renewable power generating company specializing in hydropower, EDL-Gen produces electricity both for domestic consumption and for export to neighbouring countries such as Thailand. The company owns 15 hydropower plants and one solar farm, giving a combined production capacity of 1,137MW.

EDL-Gen is committed to increasing its generating capacity. It is currently pursuing the acquisition of shares in Xayaburi hydropower project and Donsahong hydropower project from Electricite du Laos and plans to use the funds raised from this offering to complete the transaction. The acquisition will add a combined 309MW to EDL-Gen’s generation capacity and highlights its goal to become a leading power generation company in the region.

Twin Pine Group Company is the sole adviser for the transaction, while Krungthai Bank, Siam Commercial Bank, Standard Chartered Bank (Thai) and Thanachart Bank are the other joint lead arrangers, apart from Bangkok Bank.

EDL-Gen initially tapped the Thai baht bond market in December 2014 when it issued 6.50 billion baht in multiple tranches, which also marked its first offshore bond and the first corporate bond by a Laotian company in Thailand. It returned to the Thai debt market in 2016 when it raised in early September its maiden US dollar bond amounting to US$312 million to finance its expansion plan.

Date

5 Jul 2018

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