Greenergy to acquire Taiwanese biomass power plant operator

MANILA, Philippines - Listed renewable energy firm Greenergy Holdings Inc. will sell new shares to a strategic investor, for P250 million to fund the acquisition of Taiwanese biomass power plant operator, its top official said.

In a disclosure to the stock exchange, company said its board of directors approved the P250-million fund infusion from Earthright Holdings Inc. by selling 25 billion common shares at a par value of one centavo per share.

The new shares will come from the increase in Greenergy’s authorized capital stock to P2 billion from P1 billion.

“The P250 million is intended for the acquisition of a biomass operator,” Greenergy president and chief executive Antonio L. Tiu said.

Greenergy will start negotiations with Grateful Strategic Marketing Consultants Co.Ltd., a Taiwanese biomass management company that currently operates two biomass plants.

“Hopefully we can complete that [acquisition] within the next two to three months,” he said.

More funds for acquisition and capital spending will be sourced from long-term loans from Chinese firms, Tiu added.

Greenergy said it will secure a waiver from minority shareholders if there will be a need to conduct a rights or a public offering given the issuance of new shares.

Greenergy is in a joint venture with China-based Tianjin Tianbao Investment and Development Corp. for the construction of $1.3 billion worth of wind power projects with a total generating capacity of 1,000 megawatts (MW) in the Philippines in the next 10 years.

Initial investment will cost $200 million for a 49.5-MW wind energy project composed of 33 units of 1.5-MW wind mills. Tiu said the funds will be spent in the next six to eight quarters.

Meanwhile, Tiu said Greenergy still conducting a due diligence for the acquisition of Isabela Alcogas Corp., which has an ethanol project in Misamis Occidental.

Greenergy is also looking at solar power, geothermal energy and hydrolectric power projects here and abroad.

Tiu said bulk of their revenues will come from renewable energy projects in the Philippines.

“I think renewable energy projects are going to fly high. Electricity costs and oil prices have all gone up so renewable energy projects are starting to get more and more feasible,” Tiu said.

He said the implementation of the feed-in tariffs will also be beneficial to the company.

The feed-in tariff scheme, whose implementation is already delayed by almost three years, guarantees investments of renewable energy firms through fixed rates that would be shouldered by consumers over a set period of time.

Greenergy was incorporated as Music Semiconductors Corp. in 1992 to engage in the creation, design, development and manufacture of specialty semiconductor products and to market and sell the same to customers worldwide.