ACEN amending articles to do some fundraising

ACEN [ACEN 2.91, down 3.0%; 210% avgVol] [link] board of directors approved amendments to the company’s articles of incorporation that would raise its authorized capital stock by P10 billion, from P48.4 billion to P58.4 billion. The board said this is to “raise additional capital through the issuance of primary common shares... whether by way of stock rights offering, follow-on offering, or private placement.” The changes will need to be approved by shareholders at the April 23 meeting, and then by the SEC before they are effective. ACEN’s stock has fallen 26% over the past year, and has been on a rather consistent downward trend since hitting a high of nearly P13.00/share back in October of 2021. The stock is down over 75% since then.

 

MB bottom-line: ACEN has a history of taking money from investors with incredibly deep pockets, like Singapore’s sovereign wealth fund, GIC, which acquired a 17.5% stake in ACEN back in 2021 (when it was still called AC Energy), and the market is hot right now for regional infrastructure plays like this one. Converted to shares and sold, the P10 billion in additional authorized capital would increase ACEN’s outstanding shares by about 25%, and would probably raise more than P25 billion (that’s based off of a P2.50/share sale price). The shares represent a post-sale stake of about 20% of ACEN’s outstanding shares, so this is a substantial transaction. Will it change anything, though? ACEN’s long-term downtrend has been near-constant.

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