Lopez-led Energy Development Corp. (EDC) announced in a disclosure yesterday that it will no longer be listed in the Philippine Stock Exchange (PSE).
EDC’s board approved the voluntary delisting of the company’s common shares from the main board of the PSE.
The move will allow for the company to conduct a tender offer for up to 2.04 million common shares held by the public at P 7.25 per common share following the delisting rules.
Its offer price represents a 46 percent premium over the closing share price of P4.95 on Aug. 7 and a 40 percent premium over the three-month volume weighted average price of P5.18, EDC said.
Independent financial adviser KPMG noted that the tender offer price is “fair and reasonable from a financial point of view.”
The tender offer is scheduled to commence on September 25 until October 22 for a minimum 1.162 million common shares to be offered.
EDC is expected to delist its shares from the PSE once the tender offer is completed and approved.
“The intention to eventually delist EDC was shared with the market last year and the tender offer that our board has approved today presents a meaningful opportunity for our minority shareholders to realize their investment prior to the delisting of the company, at a significant premium to the current share price,” EDC President and COO Richard Tantoco said.
First Gen Corp. (First Gen) entered into an agreement with Philippines Renewable Energy Holdings Corp. in August last year. They planned to sell up to 31.7 percent of the former’s stake in EDC.
The voluntary tender offer to acquire 8.9 billion common shares of EDC for $1.3 billion was completed the next month.
At that time, First Gen and PREHC said their intentions to eventually delist EDC in favor of a corporate strategy that would need flexibility over its dividend policy and leverage.
First Gen retained its majority voting stake in EDC through wholly-owned subsidiary Red Vulcan Holdings Corp., Northern Terracotta Power Corp. (NTPC). It has 40 percent economic stake in EDC but will retain a 60 percent voting stake.
The new partners will bring in an experienced and credible partner to grow First Gen’s renewable energy platform.