The subsidiary of Japanese firm Marubeni Corporation has inked a shareholders’ agreement with the energy investment arm of the Ayala group to firm up its acquisition of 50-percent stake in the corporate vehicle for the latter’s 150-megawatt Pililla diesel power project.
The deal was cemented between Ayala-owned AC Energy Philippines Inc., its subsidiary ACE Endevor Inc.; and Marubeni’s subsidiary firm Axia Power Holdings Philippines Corporation.
This was a deal negotiated since last year and the planned partnership was announced by the Ayala company in July this year. The parties needed to secure regulatory approvals prior to the signing of their shareholders’ agreement.
“Under the agreement, Axia will acquire 50-percent of the shares and 50-percent economic rights in the company’s subsidiary Ingrid Power Holdings (Ingrid),” the Ayala energy firm said.
Ingrid is the special purpose vehicle that is advancing the diesel plant’s development at its site in Barangay Malaya, in the town of Pililla, Rizal province.
For AC Energy Philippines, it will hold 50-percent shares in the project’s corporate vehicle; and 45-percent economic rights; while its subsidiary Endevor will have 5.0-percent share of the economic rights in Ingrid.
The Ayala firm said it already infused P570 million investment into the diesel-fired power venture. The target is to eventually increase the plant’s capacity to 300 megawatts, by building a second unit of the same 150MW capacity. The project’s indicative cost for the two generating units had been pegged at P1.5 billion.
For the tie-up with Marubeni, AC Energy indicated that it already received the approval of the Philippine Competition Commission (PCC) on the deal and this was rendered by the anti-trust body on November 24 this year.
Based on the evaluation of the PCC, AC Energy stated that the transaction “will not likely result in substantial lessening to competition.” The company said it officially received the PCC decision on Tuesday (December 1).
The Ayala firm explained “the agreement provides for the terms by which the parties shall develop the Ingrid project and the terms and conditions governing the ownership, management and operation of the project company.”
As designed, the diesel plant targets to provide the needs for ancillary services power supply of transmission firm National Grid Corporation of the Philippines; and will also supply peaking and reserve power to the Luzon grid.