AN affiliate of Manila Electric Company has approved measures to improve the balance sheet of another subsidiary, Solar Philippines Tarlac Corporation, including a P3.78-billion loan facility and a capital restructuring plan.
In a stock exchange disclosure, SP New Energy Corporation stated that its board approved actions related to a term loan on September 19, which the Philippine National Bank will provide to SPTC.
SPNEC said the board authorized the “creation of a security interest over shares of SPTC owned by the Company, with the SPNEC acting as sponsor for the issuance of a Standby Letter of Credit for Debt Service Reserve Account purposes, and appointment of authorized signatories for the purpose.”
Its board of directors also approved a capital restructuring and quasireorganization to allow the unit’s board to amend its Articles of Incorporation to cancel treasury shares and increase its authorized capital by P3.576 million to create 3.576 million preferred “A” shares.
SPNEC said the board authorized it “to subscribe to 894,000 preferred ‘A’ shares” that will be issued at P1,000 each through the conversion of P894 million in shareholder advances. The restructuring will enable the unit to offset its deficit against additional paid-in capital.
The company likewise confirmed the appointment of SyCip Gorres Velayo & Co. as external auditor and the designation of new authorized signatories to carry out the transactions.
According to SPNEC, the loan and capital moves are expected to give the unit greater financial flexibility, strengthen its capital base, and support continuing operations as SPNEC, under Meralco PowerGen Corp., expands its renewable energy portfolio.
SPNEC is also developing the 3,500-megawatt Terra Solar project in Bulacan and Nueva Ecija, which is positioned to become the world’s most significant solar-battery venture.
