Solar Philippines is looking to swap 10,000 megawatts (MW) of solar power developments for only 24.37 billion shares of subsidiary Solar Philippines Nueva Ecija Corporation (SPNEC).
The 24.37 billion shares is equivalent to thrice of SPNEC’s current outstanding shares.
Solar Philippines said the planned offer is “in the interest of giving this opportunity to SPNEC’s public shareholders.”
SPNEC – the developer of the 500MW “solar ranch” project in Peñaranda, Nueva Ecija – has yet to approve any asset-for-share swap, but Solar Philippines has already reserved the subject assets for the potential deal.
“We give this option as an expression of our gratitude to our public shareholders, especially those who believed in SPNEC when it was just [Php1/share],” Solar Philippines founder Leandro Leviste said in a statement.
SPNEC ended its trading week at the Philippine Stock Exchange (PSE), closing at Php1.73/share, up by Php0.13 or 8.12% from Thursday’s close. It also was the most actively traded and the third highest gainer in Friday’s trading.
Any asset-for-share swap with SPNEC is subject to a third-party valuation and opinion by an independent financial advisor. The company has also scheduled a stockholder’s meeting in March to approve the increase of its authorized capital shock from 10 billion to 50 billion shares, which is a requirement for the proposed issuance of shares in exchange for solar projects.
An “asset-for-share” agreement or a stock swap, according to Investopedia, happens when “shareholders’ ownership of the target company’s shares is exchanged for shares of the acquiring company.”
“We are thankful for the level of interest in SPNEC, even as a single pre-operating project. At the same time, we note the feedback that adding our already operating or contracted projects would make SPNEC even more attractive,” Leviste said.
SPNEC is the first company to list under the PSE’s Supplemental Listing and Disclosure Rules for Renewable Energy Companies. The scheme provides exemptions from the exchange’s track record and operating history requirements.
SPNEC has recorded Php74.9 million in foreign investments just a month after its listing in the PSE. The Leviste-led firm was able to raise Php2.7 billion from its initial public offering, which will be used to build the first 50 MW of the project.