<\/p>\n
By Sheldeen Joy Talavera, <\/b>Reporter<\/i><\/p>\n
LOPEZ-LED First Gen Corp. has received an unsolicited, non-binding offer value $5 billion (about P308 billion) from Indonesia\u2019s PT Barito Renewables Energy (BREN) to amass its renewable energy subsidiary Energy Development Corp. (EDC), the corporate said on Wednesday.<\/p>\n
In a disclosure to the stock exchange, First Gen said the proposal was \u201cunsolicited, indicative and non-binding\u201d and stays subject to due diligence, the execution of definitive agreements, and the receipt of regulatory and other mandatory approvals.<\/p>\n
\u201cSo far, there have been no discussions between the parties, no agreements have been signed, and First Gen has not appointed any advisors for this transaction,\u201d the corporate said.<\/p>\n
The proposed acquisition would involve the country\u2019s largest geothermal energy producer, which accounts for a couple of fifth of the Philippines\u2019 installed renewable energy capability. EDC has a complete installed capability of 1,480.19 megawatts (MW) across its geothermal, wind, hydro, and solar assets.<\/p>\n
EDC also accounted for 87% of First Gen\u2019s revenues last yr, contributing P48.6 billion.<\/p>\n
BREN is the renewable energy arm of Indonesian conglomerate PT Barito Pacific Tbk. It holds a majority stake in Star Energy Geothermal, Indonesia\u2019s largest geothermal energy producer.<\/p>\n
Juan Paolo E. Colet, managing director at China Bank Capital Corp., said the proposal could unlock shareholder value if it materializes.<\/p>\n
\u201cGiven First Gen\u2019s persistent market valuation discount, such a transaction represents a possibility to return a meaningful amount of capital to shareholders while concurrently recycling proceeds into more profitable clean energy investments,\u201d Mr. Colet said in a Viber message.<\/p>\n
Based on First Gen\u2019s 45.8% economic stake in EDC, the corporate could realize about $2.29 billion (about P141 billion) from the transaction, he said.<\/span><\/p>\n Shares in First Gen were volatile following the disclosure. The stock climbed as much as 33.37% to an intraday high of P22.30 before ending Wednesday\u2019s session down 1.71% at P19.50 apiece from Tuesday\u2019s close of P19.84.<\/p>\n EDC was established in 1976 under the state-owned Philippine National Oil Co. to develop the country\u2019s geothermal resources. First Gen acquired a 60% voting stake in the corporate for P58.5 billion through privatization in 2007.<\/span><\/p>\n The corporate recently marked its 50th<\/sup> anniversary because the world\u2019s largest vertically integrated geothermal producer.<\/p>\n \u201cEDC was borne out of necessity \u2014 within the midst of an oil crisis that had affected global economies, but had more severe consequences on smaller energy-import dependent countries just like the Philippines,\u201d EDC President and Chief Operating Officer Jerome H. Cainglet said throughout the company\u2019s anniversary celebration.<\/p>\n Beyond its domestic operations, EDC has expanded into Indonesia through a partnership with PT DSSR Daya Mas Sakti to develop geothermal projects with a possible capability of about 440 MW.<\/p>\n<\/p><\/div>\n <\/p>\n","protected":false},"excerpt":{"rendered":" EDC By Sheldeen Joy Talavera, Reporter LOPEZ-LED First Gen Corp. has received an unsolicited, non-binding offer value $5 billion (about P308 billion) from Indonesia\u2019s PT Barito Renewables Energy (BREN) to amass its renewable energy subsidiary Energy Development Corp. (EDC), the corporate said on Wednesday. In a disclosure to the stock exchange, First Gen said the […]<\/p>\n","protected":false},"author":1,"featured_media":367020,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[7],"tags":[53906,34899,3954,2516,9462,2460],"class_list":["post-367019","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","tag-5billion","tag-edc","tag-gen","tag-proposal","tag-receives","tag-takeover"],"aioseo_notices":[],"aioseo_head":"\n\t\t\n\t\n\t\n\t\n\t\n\t\n\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t\n\t\t