SPNEC approves asset–for–share swap plan

MANILA, Philippines — Solar Philippines Nueva Ecija Corp. (SPNEC), the newly listed solar company, has approved its asset-for-share swap plan, which involves acquiring 100 percent of the outstanding shares of Solar Philippines Power Project Holdings Inc. and its affiliates in over 20 entities.

Solar Philippines founder Leandro Leviste said the share swap was structured in a way that it would provide more value to public shareholders.

“While we could have issued shares in exchange for the Solar Philippine assets relative to SPNEC’s existing shares at a ratio of five-to-one, we have opted for a ratio of only three-to-one, resulting in less dilution and greater value per share. We have done so to share more upside with our public shareholders who we consider to be our partners in building this company for the long term,” Levisted said.

SPNEC will acquire the assets in exchange for 24.37 billion shares of SPNEC at an issue price of P2.50 per share.

Once the asset-for-share swap is completed, SPNEC would own shares in companies such as Solar Philippines Calatagan Corp.; Solar Philippines Tarlac Corp.; Solar Philippines Tanauan Corp.; Terra Solar Philippines Inc.; SP Holdings Inc.; Solar Philippines Batangas Baseload Corp.; Solar Philippines Central Luzon Corp; Solar Philippines South Luzon Corp.; Solar Philippines Visayas Corp.; Solar Philippines Retail Electricity Inc.; Solar Philippines Rooftop Corp.; and Solar Philippines Commercial Rooftop Projects Inc.

These entities hold 33 solar energy service contracts (SESC’s) with the Department of Energy (DOE), with an operational capacity of 169.36 megawatts and capacity under development of 14,395.03 MW or over two thirds of the total 21,302.32 MW across all DOE’s service contracts in the Philippines.

This is according to the DOE’s list of Awarded Solar Projects as of Dec. 31, 2021.

Overall, SPNEC’s goal is to develop 10 GW of solar projects, representing a 20-fold increase in its targeted capacity in exchange for the issuance of only three times its currently outstanding shares.

FTI Consulting Philippines Inc., an independent financial advisor accredited by the Securities and Exchange Commission and Philippine Stock Exchange provided the third-party valuation and fairness opinion.

FTI also provided the valuation for AC Energy’s share swap at P2.37 per share in 2019, prior to AC Energy’s stock price rising to as high as P13 per share.