Cebu’s Vivant to acquire Palawan-based power firm

Cebu-based power holding firm Vivant Corp. has signed an agreement with Gigawatt Power Inc. (GPI) for the possible acquisition of Palawan-based power firm Delta P Inc.

In a disclosure to Philippine Stock Exchange (PSE), Vivant corporate secretary Jess Anthony Garcia, however, pointed out that the actual sale has yet to take place.

The memorandum of agreement with GPI will pave the way for the acquisition of up to 35 percent equity in Delta P., subject to its prior acquisition by GPI.

Garcia said only after GPI successfully acquires Delta P. may Vivant pursue the proposed transaction.

The initial estimate of the aggregate acquisition cost is between P34.44 million and P61.27 million. The proposed acquisition price per share ranges from P4.09 to P4.16.

As of the third quarter of 2006, Delta P has a total book value of over P1 billion. Vivant utilized the discounted cash flow method to arrive at the estimated aggregate acquisition price and price per share.

Vivant intends to use internally-generated funds to pay for the acquisition of the estimated 8,413,802 to 14,724,153 common shares, with payment expected to be made in full upon closing.

"However, other terms and conditions of the proposed transaction, including, but not limited to the timetable and schedule for the effectivity of the transaction, are still to be determined after an extensive due diligence examination of Delta P shall have been performed, and depending further on the terms and conditions of the acquisition by GPI of Delta P Inc., to which the company (Vivant) is not privy to," Garcia said.

Delta P is a Philippine corporation that owns a 16-megawatt bunker-fired diesel generating power plant and related facilities and supplies electric power to the National Power Corp. (Napocor) in the island of Palawan. It has 42,069,010 common shares with a par value of P1, all of which common shares have been issued and fully paid-up.