In its October 7 SEC filing, ACEN said it will subscribe to 419,690 Redeemable Preferred Shares C of NAREDCO at PHP 4,527.16 per share, amounting to a total subscription value of about PHP 1.9 billion.

The capital infusion will allow NAREDCO to fund its operating expenses, while a portion of the investment will also be used to settle the subsidiary’s outstanding obligations.

The company said the consideration will be “a straight cash payment to be made upon signing of the relevant agreements,” and that payment will be made in full.

According to ACEN, the transaction “will have no effect on the business, financial condition or operations of the issuer.” 

NAREDCO, a wholly owned ACEN subsidiary, is a key vehicle for the group’s large-scale renewable energy projects. It is currently developing the Cagayan North Solar Power Plant, a joint venture with CleanTech Global Renewables, Inc. located in Barangays Sta. Maria and Magapit in Lal-lo, Cagayan. The project spans 116.24 hectares of high solar irradiance land in Northern Luzon.

Once completed, the Cagayan North Solar Power Plant will have a total capacity of 133.464 MWp (DC), capable of supplying clean power to around 75,000 households. 

What are your thoughts on ACEN’s PHP 1.9 billion investment in its renewables arm — does this signal a ramp-up in domestic project activity or a balance sheet reorganization ahead of new capacity rollouts?

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