Aboitiz Power taking in Japanese investor

Tokyo-based Jera Co. Inc. is acquiring a 27-percent stake in Aboitiz Power Corp. at $1.58 billion, to firm up its presence in the Philippines and pursue collaboration in projects related to liquefied natural gas (LNG) and power generation.

The transaction will be made through its Singapore-based subsidiary, Jera Asia Pte. Ltd., which is focused on project development in energy-related fields of business in the continent.

The transaction is being coursed through AboitizPower’s parent, Aboitiz Equity Ventures Inc. (AEV), with which Jera has signed a share purchase agreement.

Jera and AboitizPower have identified potential areas for collaboration including the joint development of LNG-to-power projects; sourcing and managing LNG stocks as fuel for new power plants that might be built; participation in the operation and maintenance of power plants, and exploration of the use of new power-generation technologies.

In addition, they agreed to explore potential opportunities to develop “zero-emission thermal power generation” technologies that Jera is developing in Japan.

27% stake for $1.58

The two partners are referring to technologies that avoid carbon dioxide emissions during power generation by using green fuels such as ammonia and hydrogen.

This is in line with Jera’s efforts to eliminate by 2050 carbon dioxide emissions from its businesses in Japan and overseas.

Jera stands for “Japan’s Energy for a New Era.” It is a partnership between Tokyo Electric Power group and Chubu Electric Power group.

“In cooperation with AboitizPower, Jera will contribute to further development in the Philippines by both supporting the stable supply of energy in the country and contributing to an expeditious, cost-competitive roll out of clean and renewable energy while taking into consideration the unique circumstances of the country,” Jera president Satoshi Onoda said in a statement.

According to AEV, it is selling to “Japan’s largest power generation company” a 25.01-percent stake in AboitizPower at $1.463 billion.

Unlocking capital

On top of that, AEV has also agreed to sell an additional 1.99-percent stake in AboitizPower, to bring Jera’s stake to 27 percent after the transaction.

AEV will keep control of AboitizPower with an interest of 52 percent in the subsidiary.

“This transaction unlocks significant capital that will be used toward fueling the AEV group’s growth initiatives,” Aboitiz group president and chief executive Sabin M. Aboitiz said.

AboitizPower president and chief executive Emmanuel V. Rubio said Jera’s entry would help the company achieve its 10-year vision of increasing its generation portfolio to 9,200 megawatts by adding 3,700 MW of renewable energy-based generation capacity. INQ