EDC delists, opens for tender offer P14.8B worth of shares

Energy Development Corp. (EDC) yesterday said its board of directors had approved the voluntary delisting from the Philippine Stock Exchange’s (PSE) main board of its common shares as it opened for tender offer about 2 billion of such shares.

EDC said in a statement that the tender offer starts on Sept. 25, covering up to 2.04-billion common shares at a price of P7.25 apiece or a total of about P14.8 billion.

The offer covers common shares held by all shareholders except those held by major stakeholders including Red Vulcan Holdings Corp., First Gen Corp., Northern Terracotta Power Corp., and Philippines Renewable Energy Holdings Corp. (PREHC).

This exercise follows the entry of PREHC into EDC through the acquisition of 8.9-billion shares representing a 31.7-percent interest in the energy firm.

PREHC is a consortium of investors composed of funds managed by Macquarie Infrastructure and Real Assets (Mira) and Arran Investment Pte Ltd (Arran), an affiliate of GIC Pte Ltd.

EDC chair Federico R. Lopez had said Mira and GIC were the right partners as they represented “long-term and astute capital.”

Lopez also had said PREHC’s entry provided EDC with an opportunity to realize part of its investment in the country’s largest renewable energy company.

He also said PREHC and parent firm First Gen intended “to eventually delist or undertake the necessary actions that will lead to delisting” EDC from the PSE.

PREHC planned “to pursue a corporate strategy for [EDC] which will require greater flexibility over factors like its dividend policy—for example enabling it to reinvest a greater proportion of retained earnings into the business— and leverage.”