Lucio Co boosts RE venture, acquires another hydro firm

MANILA, Philippines — Retail tycoon Lucio Co is beefing up his group’s renewable energy venture with the addition of another hydroelectric facility in its growing portfolio.

Co’s listed retail holding firm Cosco Capital Inc. said it is poised to acquire the 100 percent outstanding shares of Matuno River Development Corp., the developer of the Matuno River hydroelectric power plant in Nueva Vizcaya.

Cosco said the purchase price for the transaction is below 10 percent of the company’s total book value as of end-March.

The proposed acquisition will be submitted to the Philippine Competition Commission for approval.

Cosco said the deal offers the company the opportunity to enter into another profitable business within the renewable energy sector.

The acquisition will serve an addition to the emerging renewable energy portfolio of Cosco as well as to its entire operating segment, generating more income for the company.

“This strategic move will enhance its sustainability profile, demonstrate a commitment to environmental responsibility, while contributing to the country’s overall economic development,” Cosco said.

The Matuno River hydroelectric power plant is an 8.66-megawatt (MW) run-of-river hydroelectric power plant which is covered by a hydro power service contract with the Department of Energy.

The power station draws energy from the Matuno River, a tributary of the Magat Dam.

Cosco’s entry into the renewable energy business is eyed as another opportunity segment to expand and become a profitable business portfolio in the medium and long-term.

Such move is also seen aligning the company with the government’s thrust in renewable energy and contribute to the economic development of the country.

Last March, Cosco formalized its renewable energy venture with a P552-million investment for a majority stake in Catuiran Hydropower Corp., a company engaged in the business of building, constructing, operating and maintaining power plants.