Listed renewable energy player Solar Philippines Nueva Ecija Corp. (SPNEC) is eyeing to sell shares directly to foreign entities, its top executive said.
SPNEC is planning to sell 3.25 billion shares to investors that would increase its public swap in time for the completion of its deal with parent firm Solar Philippines Power Project Holdings Inc.
The listed firm is referring to the asset-for-share swap where it would be issuing 24.37 billion shares at P2.50 apiece in exchange for the shares of Solar Philippines in a portfolio of projects.
In a media roundtable, Solar Philippines founder Leandro Leviste unveiled plans to issue at least 3 billion shares via private placement by year-end. It will take place after SPNEC’s stock rights offering (SRO).
“We had a public briefing with potential investors and the company is planning to place at least 3 billion shares by the end of the year so that we can consummate the share swap,” said Leviste, referring to the investor briefing held in March.
Leviste said it would be presumed that additional SPNEC shares will be predominantly sold through foreign institutions.
“That is the general way that such placements of that scale are often done in Philippine listed companies,” he said.
SPNEC was targeting to conclude the private placements by the end of the year. It was looking at other options such as a follow-on offering or re-IPO (initial public offering) and SRO to raise more funds for developing 10 gigawatts (GW) of solar projects and meet the minimum public ownership requirement of 20 percent.
From the rights offering, SPNEC is planning to raise P2.8 billion from the sale of 1.88 billion shares to existing shareholders at P1.50 each. It will run from Aug. 30 to Sept. 5.
“The net proceeds from the offer are intended for project development (including securing land and off-take agreements) and general corporate purposes,” the company said in its final prospectus.
Leviste said the success of the SRO would catalyze their undertaking of solar projects even though proceeds from the exercise represent a small fraction of the project cost.
At an industry standard cost of $700,000 per megawatt and revenue of P6 million per MW annually, 10 GW of projects would have a total non-land capital expenditure of $7 billion and annual revenue of P60 billion.
“The SRO’s P2.8 billion proceeds will help complete the P10 billion that we plan to invest to complete the development of 10 GW of projects,” added Leviste.
Some of the projects in the pipeline include more than 400 MW operating or under construction; the 3.5 GW solar, 4.5 GWh battery Terra Solar project; the 1.8 GW solar, 1.8 gigawatt-hour battery Batangas baseload project and 1.8 GW of projects contracted under the Department of Energy’s Green Energy Auction Program.
“With its Nueva Ecija solar project, these would potentially bring SPNEC’s contracted capacity to 8 GW scheduled to commence operations mostly between 2025 to 2026, which it estimates would be 2/3 of the total contracted renewable energy capacity of the Philippines,” he said.