Manila Electric Co. (Meralco) subsidiary MGen Renewable Energy Inc. (MGreen) will invest P15.9 billion in SP New Energy Corp. (SPNEC) by subscribing to 15.7 billion common shares and 19.4 billion redeemable preferred voting shares .
Upon closing, Meralco will own 31.4 percent of SPNEC’s common shares based on the latter’s 34.37 billion existing common shares as well as a 50.5 percent voting interest including the redeemable preferred shares.
In a statement, Meralco said SPNEC will file its application for an increase in authorized capital stock to enable the investment which is expected to fund the construction and expansion of the latter’s solar projects.
Meralco added MGreen has agreed with Solar Philippines Power Project Holdings Inc. (SPH) to use SPNEC as the primary vehicle to develop 3,500 megawatts of solar projects and 4,000 megawatt-hours of battery energy storage systems in Luzon.
“This will be one of the largest solar projects not just in Asia but in the world… The Department of Energy’s vision is to have about 35 percent of the country’s energy come from renewable energy (RE) and this is one of Meralco’s major contributions to this goal,” said Manuel Pangilinan, Meralco chairman and chief executive officer.
Leandro Leviste, SPNEC chief executive officer, that the partnership will bring in “Meralco’s capabilities” in the company’s “solar developments for the benefit of all stakeholders.”
Completion of the transaction is subject to the satisfaction of certain conditions precedent, including relevant regulatory approvals.
UBS acted as financial advisor in this transaction while SyCip Salazar Hernandez and Gatmaitan and Gulapa Law acted as legal advisors to both Meralco and MGreen as King and Spalding and Picazo Law acted as legal advisors to SPH and SPNEC.
