MANILA, Philippines — Singapore state fund GIC Private Ltd. begins the first phase of its investment in AC Energy Corp. (ACEN) via an P11.9-billion private placement on March 18.
In a disclosure to the Philippine Stock Exchange yesterday, ACEN said the private placement involves the issuance of 4 billion common shares at P2.97 apiece for a total of P11.88 billion to Arran Investment Pte Ltd, an affiliate of GIC Private Limited (GIC).
The value per share was determined by Arran after conducting a due diligence exercise on ACEN’s existing business and potential.
Once completed, Arran is set to own 20.04 percent of the issued and outstanding ACEN’s common shares. The private placement and execution of subscription agreement is set on March 18.
The private placement will decrease the public float of ACEN from 24.96 percent to 19.96 percent and increase the foreign ownership level from 1.31 percent to 21.75 percent.
ACEN will seek shareholders’ approval of the listing of the common shares to be issued to Arran during its annual stockholders’ meeting on April 19.
“The private placement will enable ACEN to raise additional capital to fund its various developmental and operating projects, as well as potential acquisitions. The entry of Arran as an institutional investor will also strengthen ACEN’s investor base,” the disclosure read.
Of the total investment amount, ACEN will use up to P10 billion to fund some of its renewable energy developments in the pipeline, including its Arayat solar project in Pampanga, and the Bayog wind project in Ilocos Norte, as well as possible expansions of existing plants and acquisition of other operating plants.
The Ayala firm said this funding is estimated to be used in the first half of 2021 at the earliest.
ACEN will also use part of the proceeds for the repayment of debt drawn earlier to fund development funding requirements, as well as fund working capital requirements, and for general corporate purposes of approximately up to P500 million.
Earlier, ACEN said Arran is acquiring a 17.5 percent stake in the company for P20 billion, which will be implemented through a combination of subscription to four billion primary shares via a private placement and purchase of secondary shares.
The completion of Arran’s acquisition of additional common shares in ACEN from ACEIC is estimated to be by third quarter 2022.
In January, ACEN and parent firm AC Energy and Infrastructure Corp. signed an investment agreement with Arran for the acquisition. Arran’s proposal to invest in ACEN was approved by the Ayala firm’s board in November last year.
AlphaPrimus Advisors acted as financial advisor to ACEN and AC Energy for the transaction.
“Ultimately, after completion of the private placement, ACEN’s planned follow-on offering, the proposed property for shares swap between ACEN and ACEIC for the infusion by ACEIC of its international assets to ACEN, and the purchase of Arran of secondary shares from ACEIC, Arran shall own 17.5 percent of ACEN,” the disclosure read.
ACEN, the energy platform of Ayala Corp., is one of the fastest growing energy companies with over $1 billion of invested and committed equity in renewable and thermal energy in the Philippines and around the region.
The company aspires to become the largest listed renewables platform in Southeast Asia, with the goal of reaching 5,000 megawatts (MW) of renewables capacity by 2025.