Solar power firm Citicore Renewable Energy Corporation (CREC) has pegged its initial public offering (IPO) price at P2.70 per share for a total offering size of P5.3 billion.
In its final offering prospectus, CREC said the offer price was determined based on a book building process and discussions between the issuer, the selling shareholder and the joint bookrunners.
The IPO consists of 1.79 billion primary common shares with an overallotment option of up to 178.57 million secondary common shares to be sold by Citicore Power Inc.
The offer period shall begin on May 27, 2024 and end on May 31, 2024. CREC and the joint bookrunners reserve the right to extend or shorten the Offer Period, subject to regulatory approval.
The offer shares are expected to be listed on the PSE Main Board under the symbol “CREC,” on or about June 7, 2024.
Gross proceeds from the sale of primary shares will be P4.82 billion while net proceeds is estimated at P4.52 billion after deducting the applicable underwriting fees, costs and expenses for the offer.
CREC will not receive any proceeds from the sale by the selling shareholders of any option shares, to the extent the overallotment option is exercised.
The firm said it intends to use the net proceeds from the IPO for the group’s capital expenditure and pipeline development requirements.
In the event that the net proceeds is less than the expected amount, CREC said it intends to allocate the proceeds in order of priority as follows: capital expenditures and pipeline development (solar energy plants) for the year 2024; capex and pipeline development (solar energy plants) for the year 2025; and capex and pipeline development (battery energy storage systems or BESS) for the year 2024.
Approximately P3.58 billion or 79.4 percent of the net proceeds from the sale of firm shares will be used to fund the capital expenditures and pipeline development for solar energy power plants and BESS of the Issuer.
The balance of its funding requirements shall be sourced from internally generated cash and project financing facilities with certain banks.
CREC will require P300 million for general corporate purposes which include, but are not limited to, expenses related to business development, general working capital requirements, corporate office overhead, administrative expenses and other costs shouldered by the firm in the normal course of business operations not specifically related to any single project.
CREC has a pipeline of renewable energy projects in the Philippines in line with its goal of adding approximately 1.0GW of ready-to-build/under construction solar energy capacity each year through 2027.
Citicore is a pure-play renewable energy platform that directly and through its subsidiaries and joint venture manages a diversified portfolio of renewable energy generation projects, power project development operations and retail electricity supply in the Philippines.