Solar Philippines Power Project Holdings, Inc. (SP)m is planning to inject its solar portfolio with over 10,000 MW of developments into listed Solar Philippines Nueva Ecija Corporation (SPNEC) in exchange for P39-billion worth of shares.
In a statement, SP said it is open to swap its assets for three times SPNEC’s current outstanding shares, or 24.37 billion shares. SPNEC shares closed at P1.60 each at the Philippine Stock Exchange on Thursday.
SPNEC has not yet approved any asset-for-share swap, which is subject to a third-party valuation and fairness opinion by an independent financial advisor.
It has also set a Stockholders' Meeting for March 7, 2022 to approve the increase of its authorized capital stock from 10 billion to 50 billion shares, which would be required for the proposed issuance of shares in exchange for solar projects.
While this evaluation is ongoing, Solar Philippines is reserving the subject assets for the potential asset-for-share swaps with SPNEC, in the interest of giving this opportunity to SPNEC’s public shareholders.
Solar Philippines began developing this pipeline in 2015, in anticipation of the day when this demand would come.
Its portfolio now comprises over 20 solar project companies, which include over 400 MW already operating or under construction. Certain projects are at a similar stage as SPNEC’s 500 MW development, while others are planned to begin operations a later date given their scale.
SPNEC recently raised P2.7 billion from its initial public offering for the equity of the 500 MW Nueva Ecija Solar Farm in 2021, becoming the first pure-play solar company to list in the PSE.
To fund the remainder of the 10,000 MW, Solar Philippines is entering into joint ventures with partners who can help turn these plans into a reality and may raise further capital including a possible stock rights offering if a share swap with SPNEC is approved.
With this, Solar Philippines targets to increase SPNEC’s planned capacity by 20 times while increasing outstanding shares by only five times. The company acknowledged the importance of responding to the preferences of its public shareholders.
“We are thankful for the level of interest in SPNEC, even as a single pre-operating project. At the same time, we note the feedback that adding our already operating or contracted projects would make SPNEC even more attractive,” said Solar Philippines Founder Leandro Leviste.
He added that, “We give this option as an expression of our gratitude to our public shareholders, especially those who believed in SPNEC when it was just P1.00 per share.”