SPNEC IPO 2x oversubscribed, set for Dec. 17 listing

Solar ranch: Southeast Asia’s largest solar plant will soon rise from this ranchland by SPNEC.

MANILA—The Initial Public Offering (IPO) of Solar Philippines Nueva Ecija Corporation (SPNEC), developer of what is touted as Southeast Asia’s largest solar project, is almost two times oversubscribed ahead of its market debut on Friday, Dec. 17, 2021.

“SPNEC’s IPO was oversubscribed, receiving Php 5.3 billion in orders for the Php 2.7 billion offering, with strong demand from investors who want exposure to the first pure-play solar company to list on the PSE,” said the firm’s underwriter Abacus Capital and Investment Corporation.

The oversubscription comes as the company’s IPO was already sized at the maximum of its indicative range of up to 2.70 billion shares at up to Php 1.00 per share, which would result in SPNEC having a market capitalization of Php 8.12 billion.

“We’re grateful for the public’s faith in our ability to turn this power point into a power plant, and hope our work can live up to these expectations,” said Solar Philippines founder Leandro Leviste in a statement issued Wednesday.

The PSE’s tenth and final IPO for 2021, SPNEC is the first company to list under the Supplemental Listing and Disclosure Rules for Renewable Energy (RE) Companies approved by PSE in 2011 which provides exemption from the PSE’s track record and operating history requirements. To date, SPNEC is at the pre-operating stage and has not commenced commercial operations.

Proceeds from the IPO will be used to complete the first 50 MW of the project and acquire land to expand the project beyond 500 MW, in support of SPNEC’s plan to develop the largest solar project in Southeast Asia.

Solar Philippines incorporated SPNEC in 2016 and secured a DOE service contract to develop the Nueva Ecija project in 2017, with construction planned to start by the end of 2021. Once operational, the project is intended to supplement the Luzon grid’s thin reserves and help prevent rotating outages that affected millions of Filipinos earlier this year.

SPNEC’s IPO comes as Prime Infrastructure Holdings, Inc. (Prime Infra), owned by tycoon Enrique K. Razon, announced investments for a total of Php 3.5 billion for a 50% stake in three solar projects with a total of 340 MW. Developed by SPNEC’s parent company, Solar Philippines, these solar projects are located in the provinces of Tarlac, Batangas, and Cavite. In an earlier statement, Prime Infra referred to its investments in Solar Philippines as “a testament to Prime Infra’s commitment to sustainability and growing its partnership with Solar Philippines.”

Solar Philippines has indicated that its strategy is now focused on helping the country’s power companies enter the solar market, by making available project sites it has developed over the years.

“We want to help the country’s power companies replace their future coal and gas developments with solar, so that together, we can make solar the largest source of energy in the Philippines,” Leviste said in a recent interview.

For his part, PSE President and CEO Ramon S. Monzon earlier said: “I am pleased that PSE can support a renewable energy (RE) company with its fund raising requirements. The need for RE is more amplified now as more companies are turning to RE as part of their climate action program.”