Lopez Group's solar power venture eyes IPO

MANILA, Philippines - Lopez unit First Philec Solar Corp. (FPSC), the country’s sole manufacturer of solar wafer, is eyeing to undertake an initial public offering (IPO) in the medium term.

“That is always part of our future plans,” Dan Lachica, FPSC president and CEO said.

However, he said since their company has just started operations last year, it needs to establish a track record first before listing its stocks in the local bourse.

He said they are also open to possible partnerships if they decide to pursue further expansion of their operations.

These plans, he said, are also part of their long-term goal to go into solar power generation.

The FSPC official said being part of First Philippine Holdings Corp., the energy investment arm of the Lopez Group, solar power generation could be one of the synergies to look at.

He said the advent of renewable energy development would also give way to more opportunities for solar power development.

“It will depend on incentives that the RE law and the National Renewable Energy Board (NREB) would provide to investors,” he said.

FPSC is registered with both the Board of Investments and Philippine Economic Zone Authority. Lachica said they are still studying whether to apply as an RE company to avail of the incentives under the RE law.

 Lachica said in the meantime, they intend to concentrate on solar wafer manufacturing which has been doing good, banking on an annual growth projection of about 20 to 40 percent.

FPSC is a joint venture between First Philippine Electric Corp., a wholly-owned subsidy of First Holdings, and California-based SunPower Philippines Manufacturing Ltd. (SPML), the Philippine subsidiary of SunPower, the world’s leader in silicon technology conversion efficiency.

It plans to spend around $100 million to become the biggest solar wafer manufacturing firm in Asia.

To date, the company had spent $40 million to finance its initial production.

FPSC’s current facility and planned Phase 2 expansion are located at the First Philippine Industrial Park in Sto. Tomas, Batangas. The expansion will also double its workforce from the present 535 to over 1,000.

During the first full year of operations, FPSC generated revenues of $52 million and net profit of $336,000.

From 2009 to 2012, FPSC estimates to generate annual revenues of over $120 million and net income of $20 million.

At full build, the factory will churn out 240 million silicon wafers a year for two SunPower plants and other customers using 100 highly automated wafer slicing machines to support approximately 720 megawatts of solar energy.

The company will utilize loans, internally generated funds and additional equity of approximately $20 million to complete Phase 2 expansion, covering a new building and equipment.

It is also gearing for overseas expansion where demand for silicon wafers will likewise increase.