Citicore REIT IPO slated for February

citicore new logo with bg

The Philippine Stock Exchange (PSE) and the Securities and Exchange Commission (SEC) have given the go-signal for Citicore Energy REIT Corporation’s (CREIT) initial public offering (IPO) this February.

Citicore said it received a new pre-effective approval from the SEC on January 13, while the PSE gave its clearance the following day. CREIT, slated to be the country’s first energy real estate investment trust (REIT), will be conducting the IPO from February 2-8. The listing is tentatively scheduled for February 17.

The SEC had approved the IPO in November for a supposed listing in mid-December.

Meanwhile, the PSE — in its listing notice on Wednesday — said that CREIT’s IPO price would be set at a maximum of Php3.15 per share. The IPO price will be finalized on January 26.

A total of 6.55 billion shares would be listed, but only 3.21 billion would be sold to the public, from which CREIT aims to raise Php10.1 billion. Of the 3.21 billion shares, 1.05 billion would be allotted for the primary offering, 1.74 billion for the secondary offer, and 418 million for the over-allotment.

The other 3.34 billion shares would be held under escrow by CREIT’s sponsors – Citicore Renewable Energy Corporation (CREC) and Citicore Solar Tarlac 1, Inc.

According to Investopedia, a REIT is a company that owns, operates, or funds income-generating forms of real estate. Patterned after mutual funds, REITs pool together capital gathered from investors, who can earn dividends from real estate investments without buying, managing, or financing actual properties.

CREIT will use the net proceeds from the primary offer to acquire properties in Bulacan and South Cotabato, while those from the secondary offer would be used by CREC and Citicore Solar Tarlac 1.

“This business model, we believe, is cycle-resistant as solar power generation is an essential industry, further supported by government programs, and has a clear plan for long-term growth. With the search for attractive returns, alongside a strong and effective [environmental, social, and governance] advocacy as criteria for a sound market investment, CREIT comes in as a practical alternative,” CREIT President and CEO Olver Tan said in a statement.

BDO Capital & Investment Corporation and Unicapital Inc. will serve as CREIT’s joint global coordinators for the offer. PNB Capital and Investment Corporation, together with Investment & Capital Corporation of the Philippines will serve as the project’s lead local underwriter. The company has also tapped CIMB Investment Bank Bhd and CLSA Limited as its international bookrunners. 

BDO Capital said late last year that it is open to funding renewable energy projects in the country.

Citicore developed the country’s first agro-solar farm in Tarlac, while CREC has a joint venture with Ayala-led ACEN for a 72-megawatt solar farm in Pampanga.