Herbert Smith advises BG Group on its agreement to sell its interests in power stations in the Philippines to Korea Electric Power Corporation
29 September 2010
A joint team from the Singapore and London offices of Herbert Smith LLP has advised longstanding client BG Group on the sale of its indirectly held 40% interests in the Santa Rita and San Lorenzo power stations in the Philippines to Korea Electric Power Corporation (KEPCO) for a net consideration of approximately US$400 million.
The Santa Rita and San Lorenzo power plants have a capacity of 1000MW and 500MW respectively. Both combined cycle natural gas-fired power plants are located in Batangas, on the island of Luzon, 80 kilometres south of Manila.
BG Group signed a sale and purchase agreement with KEPCO today. The net consideration under the agreement is subject to standard completion adjustments, including interest to be paid to BG Group upon closing, which is expected in the first quarter of 2011. Closing of the transaction is subject to receiving necessary waivers and consents from non-recourse lenders as well as First Philippine Holdings Corporation, which indirectly holds 60% interests in the Santa Rita and San Lorenzo power plants. If the deal completes, it will be the first time a Korean company has acquired significant equity interests in overseas power plants in operation.
The Herbert Smith team was led by partner Lewis McDonald, and senior associate Philip Morgan, both of the firm’s Singapore-based South East Asian energy practice. Support was provided by a team drawn from the firm’s Singapore and London offices.
Singapore-based energy partner Lewis McDonald commented:
“The successful execution of this transaction demonstrates the firm’s market leading credentials in the South East Asian power sector as well as our ability to lead significant sell-side energy M&A transactions from our Singapore office. BG Group is a key, long-term client of the firm both in this region and worldwide and we are delighted to have assisted them with this transaction.”
Alejandro Figueroa led the in house legal team at BG Group. ACCRALAW and Sicangco & Sicangco Law Offices advised BG Group on Philippines law aspects of the transaction and Walkers provided BVI law advice. NM Rothschild & Sons provided financial advice to BG Group. KEPCO was advised by Baker & McKenzie, as international legal counsel, and ING, as financial adviser.
Notes to editors
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