AC Energy to get over 50% stake in Phinma Energy

By Lenie Lectura – February 7, 2019
from Business Mirror

AC Energy Inc. and Phinma Energy Corp. are set to sign a definitive agreement that will give the power arm of conglomerate Ayala Corp. a 51.48-percent stake in PHEN valued at P3.42 billion.

“We expect to sign the definitive document fairly soon, within the next few days,” AC Energy President Eric Francia said.

Both earlier signed a mutually strategic agreement that states AC Energy will acquire Phinma Corp. (PHN) and its parent Philippine Investment Management (Phinma) Inc.’s (PHI) combined 51.48-percent stake in PHEN.

The deal will be finalized pending regulatory approvals, including the approval of the Philippine Competition Commission (PCC), and compliance with applicable tender-offer requirements.

Francia said they will seek PCC’s approval after the definitive agreement is signed.

“Soon after that, we will file for PCC approval. PCC can take as fast as 60 days to 90 days.  This could be anywhere between three months and six months. So, we’re looking at the middle of the year in terms of getting PCC approval,” Francia said.

The next step, he said, is to execute the mandatory tender offer.

After the sale, PHEN will focus on its education and construction-materials business.

PHEN has an attributable generation capacity of 472 megawatts (MW). It is the third-largest stand-alone retail electricity supplier serving 378 MW of customer demand.

It holds interests in the following entities: Phinma Power Generation Corp. (100 percent); Phinma Renewable Energy Corp. (100 percent); CIP II Power Corp. (100 percent); One Subic Power Generation Corp. (100 percent); One Subic Oil Distribution Corp. (100 percent); Phinma Solar Corp. (60 percent); Phinma Petroleum and Geothermal Inc. (50.74 percent); Palawan Exploration and Production Corp. (30.65 percent); South Luzon Thermal Energy Corp. (45 percent); and Maibarara Geothermal Inc. (25 percent).

Francia said AC Energy is not inclined at the moment to pursue the oil and gas activities of Phinma Petroleum which has been awarded service contracts by the Department of Energy.

“The upstream oil and gas business is not our core.  We’ll need to study what to do with those after the deal closes, but we have no intentions of going into oil and gas exploration,” Francia said.

AC Energy, he said, is focusing on growing its renewable-energy portfolio.

Based on its equity interest in power-generation businesses, it owns approximately 1.7 gigawatts (GW) of generation capacity in operations and under construction. In 2018 AC Energy generated 2,800 GWH of energy, of which 48 percent was from renewable sources.