US firm acquires P8.68-B worth of First Gen shares via tender offer

Published October 6, 2021, 3:02 PM

by Myrna M. Velasco

New York-headquartered investment firm KKR & Co. Inc. will be acquiring additional 7.3 percent equity in Lopez-owned First Gen Corporation via a tender offer (TO) transaction worth P8.68 billion or roughly $171 million.

The TO covered 262.937 million common shares that were unloaded by the minority shareholders of the Lopez-led energy firm and was purchased by KKR subsidiary Philippines Clean Energy Holdings Inc., which serves as the offeror-entity.

KKR indicated that it “waived its maximum limit of 205 million shares under the term of the tender offer and accepted all of the 262,937,672 common shares of First Gen that were tendered by shareholders at the close of the tender offer.”

In a statement to the media, the global investment firm noted that “the offeror intends to acquire all of these tendered common share at a price of P33 per common share through a block sale on the facilities of the Philippine Stock Exchange,” and that is scheduled on October 8 this year, which is the cross date specified in the tender documents.

This is already the second round of shares acquisition that KKR will be carrying out for First Gen – the first one was June last year for 11.9-percent equity worth P9.6 billion.

The US firm expounded “with the completion of the share acquisition, KKR, which is an existing shareholder in First Gen, will hold an approximately 19.9-percent ownership stake in the company.”

According to Michael De Guzman, managing director of KKR’s infrastructure team, the American company has great “admiration for First Gen’s business and strategy – including its work to support the energy transition in the Philippines.”

He stated that with KKR’s added investment in the Lopez-led energy firm, “we are pleased to have this opportunity to extend our shareholding in First Gen and support its work to provide critical energy solutions to millions of Filipinos across the country.”

De Guzman similarly stressed that “this investment marks the latest milestone for KKR in the Philippines, and deepens our commitment to the market.”

The First Gen group’s power generation portfolios mainly lean on clean energy technologies – such as various renewable energy developments in geothermal, solar, hydro and wind facilities; as well as gas-fired power projects which are touted as the best technology coupling to renewables.

The Lopez firm is also currently advancing the completion of its proposed liquefied natural gas (LNG) import facility with floating storage and regasification unit (FSRU) that is targeted for commercial operations by fourth quarter next year.

 
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