Solar Philippines NEC buys $1.2 billion in power generation assets from its parent company
Solar Philippines Nueva Ecija Corp. acquires stakes in more than 20 solar power generation projects across the Philippines, valued at 60.9 billion pesos ($1.2 billion), from its parent company in an equity deal which will transform the company into one of the countries. major producers of renewable energy.
Under the deal approved by its shareholders this week, Solar Philippines NEC will issue 24.4 billion new shares to its majority shareholder Solar Philippines Power Project Holdings Inc. at 2.50 pesos apiece, in exchange for its company’s stakes. mother in more than 20 solar power generation assets across the country. These assets can generate up to 10 gigawatts of electricity, representing more than two-thirds of service contracts already awarded by the Department of Energy, Solar Philippines NEC said in a regulatory filing on Monday.
Shares of Solar Philippines NEC have doubled in value since its IPO in December as the company unveiled its expansion plans in recent weeks. The company raised 2.7 billion pesos in its IPO to finance the development of its first solar farm in Nueva Ecija province, north of Manila. Built in three phases, the solar parks can produce up to 500 megawatts when fully constructed.
Solar Philippines Power, controlled by Leandro Leviste, a Forbes Asia 30 alumni under the age of 30 will increase their stake in Solar Philippines NEC to 91.7% from 66.8% once the share swap is completed by mid-year, the company said. Following the completion of the share swap, Solar Philippines NEC plans to raise 10 billion pesos in a secondary rights offering to finance the development of the solar projects it is acquiring from its parent company.
“We need at least 10 billion pesos to complete the development of 10 gigawatts of solar projects,” Leviste said in a statement recently. “It’s only a small percentage of the project cost, but we think it’s a big percentage of the value, with development being the bottleneck of the Philippines’ energy transition.”
Leviste, 28, founded Solar Philippines in 2013, spending around $100 million in bank loans arranged by family connections as well as proceeds from the sale of his shares in Tesla Motors that he bought while dating the Yale University in the United States. His mother, Loren Legarda, is the deputy speaker of the House of Representatives, while his father, Antonio Leviste, was the former governor of Batangas province, south of Manila.
“As a developer, Solar Philippines NEC’s business model is to prepare projects for start-up and then bring in joint venture partners who can help fund construction,” Leviste said. “That said, we could also invest a much larger amount, and would take the opportunity to do so if it proved to be accretive for shareholders.”