Power utility PPC is expected to announce, within the next fortnight, a 150 million-euro collection from a small-scale securitization agreement reached with JP Morgan last summer, promising some cash-flow security for the corporation.
PPC and JP Morgan still need to finalize certain procedural matters before the payment can be made.
This initial 150 million-euro collection represents 75 percent of a 200 million-euro total amount PPC anticipates from the small-scale securitization package, concerning unpaid receivables of up to 60 days.
Given its short-term span, this agreement, a non-recourse agreement not requiring PPC to provide guarantees, is rated as a low-risk securitization package.
If the debt collection firms – Qualco and law offices – commissioned to collect unpaid receivables from PPC customers on behalf of the utility fail to do so, then JP Morgan, which has purchased related bonds, or senior notes, will incur corresponding losses.
PPC has also signed a securitization package with Pimco for longer-term unpaid receivables of over 90 days, from which the utility expects to collect part of a 300 million-euro total in December or January and the remainder at a latter date.
The news of an imminent securitization payment for PPC comes at a time when the company share has enjoyed major gains. PPC’s share has risen 278 percent since a low last March.
Forthcoming results for the nine-month period, as well as news on the company’s solar energy projects and new business plan for 2021-2023 should provide a further boost.