Utility firm Tarlac Electric Inc. is planning a P603.75 million initial public offering in compliance with its franchise requirement to go public with 30 percent of its outstanding capital.
The Securities and Exchange Commission said it has received the registration statement of Tarlac Electric for a primary offer and sale of 1.75 million common shares at an offer price of P345 per share.
The public offer is in line with Republic Act No. 10795, otherwise known as TEI’s franchise, which requires the company to publicly offer 30 percent of its outstanding capital stock to Filipino citizens on or before the fifth year of its operations.
Net proceeds from the offer will be used to fund the company’s expansion projects, to retire maturing short-term debt or obligations, and to fund its general working capital.
TEI has engaged Penta Capital & Investment Corporation as sole underwriter for the offer.
Tarlac Electric Inc., formerly known as Tarlac Enterprises, Inc., first received its franchise to operate as a private electric distribution utility serving the electric power requirements of the Municipality of Tarlac (now the City of Tarlac) in 1949.
This is by virtue of the Manila Franchise and the reconstituted Certificate of Public Service and Necessity transferred from its former owner, Manila Electric Company.
On 18 October 2016, TEI’s Franchise was renewed for 25 years under Republic Act No. 10795. Among the conditions set forth in the Franchise is the public offer of at least 30 percent of TEI’s outstanding capital stock to Filipino citizens on or before its fifth year of operations.
Initially, the Company’s market was mostly residential. Through the years, as its franchise area developed from a town to a city, its market was likewise transformed into a mix of residential, commercial, and industrial consumers.
As of 2019, TEI services 82,632 customers from six different customer classes namely: Residential, Small Commercial, Secondary, Primary, 69 kV, and Streetlights.
TEI’s energy sales for the year 2019 was at 438,802 MWh.