Philippine Power Sector Assets and Liabilities Management Corporation in $1.2 Billion Liability Management Transaction and Global Bond Offering

Cleary Gottlieb represented the joint dealer managers / joint lead managers in the $1.2 billion combined liability management transaction and global bond offering by Power Sector Assets and Liabilities Management Corporation (“PSALM”). The transaction consisted of (1) an exchange offer in which three series of bonds of the National Power Corporation (“NPC”) were exchanged for an aggregate $600 million of PSALM’s 7.39% bonds due 2024 and 7.25% bonds due 2019, in each case guaranteed by the Republic of the Philippines, and (2) an offering for cash of $600 million of PSALM’s 7.39% guaranteed bonds due 2024. The invitation to exchange old NPC bonds for new PSALM bonds was made in the United States in a private offering under Section 4(2) of the Securities Act and outside of the United States in offshore transactions in reliance on Regulation S. The invitation was launched on November 16 and expired on November 24. The offering of bonds for cash was made in a Rule 144A/Regulation S offering and was priced on November 23. The combined transaction closed on December 2.

PSALM is wholly owned by the Republic of the Philippines, and was created to manage the privatization and restructuring of the Philippine electric power industry, including the debts of NPC.

Cleary Gottlieb also represented the underwriters in PSALM’s inaugural global bond offering in May.