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Solar PHL unit starts share sale

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Solar Philippines Nueva Ecija Corp. (SPNEC) started selling shares for its initial public offering (IPO) on Wednesday after the company secured a license from the Securities and Exchange Commission (SEC).

The offer period will run through December 7, with a tentative listing date on the main board of the Philippine Stock Exchange (PSE) on December 17.

“We thank the PSE and SEC for approving this IPO, which aims to give the public a new option to invest in RE [renewable energy] and increase the RE capacity of the Philippines. Furthermore, we are thankful for this opportunity to launch the Solar Philippines group’s first public offering, which we see as a favorable signal for future offerings,” Solar Philippines Chairman Leandro Leviste said.

Solar Philippines incorporated SPNEC in 2016, and secured a service contract from the Department of Energy to develop the Nueva Ecija project in 2017. The company plans to start construction of the project before the end of 2021. Once operational, the project is intended to supplement the Luzon grid’s thin reserves and help prevent the rotating outages that affected millions of Filipinos earlier this year. 

SPNEC is aiming to raise some P2.7 billion by offering 2.7 billion common shares at P1 per share.

The proceeds of the IPO will be used to complete the first 50 megawatt of the project and acquire land to expand the project beyond 500 MW, in support of SPNEC’s plan to develop the largest solar project in Southeast Asia.

SPNEC’s solar power plant is still at the pre-operating stage.

Some P1.3 billion of the proceeds will be used to fund the construction of Phase 1A of its project and the remaining P1.3 billion will be used to acquire land for future expansion.

The total project cost for its first phase is P4.87 billion, a quarter of which will be funded via equity while the remaining 75 percent will be funded via debt.

The total project cost of the company’s 500 megawatt solar PV power project is estimated at around P11.9 billion, inclusive of estimated financing and capitalization costs and value added taxes but are exclusive of any IPO related fees and expenses, the company said in its prospectus.

The Nueva Ecija project would be the largest among the first 1 gigawatt of projects of Solar Philippines planned to be operating by 2022.

Its other projects include one in Batangas with an operational 63 MW in partnership with Korea Electric Power Corp.; one in Tarlac, which is being expanded to up to 200 MW in partnership with Prime Infra of the Razon Group; and another two in Batangas and Cavite with a combined capacity of 140 MW planned to be fully operational by 2022.  Abacus Capital and Investment Corp. has been assigned as issue manager and lead underwriter and Investment Capital Corp. of the Philippines as participating underwriter for the deal.

Read full article on BusinessMirror

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