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Stock Commentary

AC Energy acquires 49% stake of 837MW solar in Vietnam

Merkado Barkada
AC Energy acquires 49% stake of 837MW solar in Vietnam

The guts of the deal are this: AC Energy's [ACEN 9.50 0.42%] subsidiary, AC Energy Vietnam Investments Pte. Ltd., paid $165 million to acquire 49% of Solar NT from Solar NT’s parent company, Super Energy Group (Hong Kong) Co., Limited (“Super HK”).

The ultimate parent of Super HK is Super Energy Corporation Public Company Limited (“SUPER”), a “premier” Thai renewable energy developer.

The deal was 100% secondary shares, which means that ACEN paid the cash directly to Super HK for the 49% stake in Solar NT; none of that funding will go to Solar NT itself for further development.

Solar NT is apparently restructuring, and when the transaction is complete, it will own/operate 837 megawatts (MW) of solar capacity in Vietnam.

ACEN discloses that the deal for Solar NT represents the start of a strategic partnership with SUPER to “expand their renewable footprints in Vietnam” and explore development in other ASEAN markets. The deal increases ACEN’s foreign renewable energy capacity to 1,500 MW, with 1,000 MW of that in Vietnam. 

MB BOTTOM-LINE

While it remains to be seen how the love story may grow between Solar Philippines NEC [SPNEC 2.32 4.50%] and ACEN for the development of SPNEC’s coveted solar-rich property portfolio, ACEN is pushing ahead aggressively with its foreign expansion in the renewable energy space, particularly in solar.

As the cost per kilowatt-hour of solar-generated electricity continues to drop, and as the region’s electricity consumption continues to rise (especially once COVID’s drag on the economy is largely a thing of the past), it’s a safe assumption that nearly every country in the region will have SPNEC-like opportunities just begging for development.

As one of ASEAN’s leaders in the field, the key for ACEN shareholders will be one of opportunity cost: what is the optimum deployment of ACEN’s time, money, and attention, across all of its various opportunities both home and abroad, to bring about the highest rate of return for shareholders both now and in the future?

Deals like these, for projects that are already generating income that come wrapped in a larger shared interest in regional development, offer shareholders both “now” and “later” upside. 

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Merkado Barkada's opinions are provided for informational purposes only, and should not be considered a recommendation to buy or sell any particular stock. These daily articles are not updated with new information, so each investor must do his or her own due diligence before trading, as the facts and figures in each particular article may have changed.

AC ENERGY INC.

AYALA CORP

PHILIPPINE STOCK EXCHANGE

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