First Gen Corp., the power producer controlled by the Lopez family, rejected allegations from a majority faction of its founding clan over a ₱50 billion premium paid for a stake in a pumped-storage hydropower venture, saying the claims show the fundamental misunderstanding of corporate finance.

In a regulatory filing with the Philippine Stock Exchange on Wednesday, June 10, First Gen clarified that the financial figures cited by the family bloc stem from an outdated 40 percent acquisition framework.

The transaction was scaled down early this year, with First Gen subsidiary FGEN Aqua Power Holdings Inc. securing a 33 percent equity stake in Prime Hydropower Energy Inc. for a total consideration of ₱61.87 billion.

Prime Hydropower, a unit of billionaire Enrique Razon Jr.’s Prime Infrastructure Capital Inc., is actively developing the Wawa and Pakil pumped-storage hydro facilities.

First Gen broke down the ₱61.875 billion cash outlay into two components. It paid ₱12.5 billion to Prime Infrastructure for 6.67 percent of outstanding common shares, and allocated ₱49.375 billion toward a 26.33 percent interest via primary share subscriptions.

The payment structure is staggered, featuring an immediate ₱16.5 billion cash disbursement, a pair of Standby Letters of Credit totaling ₱24.75 billion due in 2027 and 2029, and ₱20.625 billion to be drawn gradually based on funding calls from the Prime Hydropower board.

Responding to accusations from the family group that the deal was an opaque transaction that left the public blind to a heavy multi-billion-peso premium, First Gen maintained that such premiums are standard practice in commercial mergers and acquisitions and are integrated into the overall valuation of the asset.

The company countered that the premium reflects the substantial upfront costs and capital Prime Infrastructure poured into the infrastructure over five years to completely de-risk the projects prior to First Gen's entry. Prime Infrastructure achieved financial close in 2025, locked in long-term contracts under the government’s Green Energy Auction Program, and has already advanced early-stage construction.

First Gen also defended the decision to scale back its equity ownership from 40 percent to 33 percent, dismissing assertions that it surrendered crucial minority veto rights. The company described the downscaling as a strategic, prudent capital allocation move to maintain adequate liquidity for other high-potential power assets in its development pipeline.

Financial liquidity considerations outweighed any minor rights attached to a 40 percent shareholder, First Gen said, adding that nothing bars the company from renegotiating a larger stake with Prime Infrastructure in the future.