NGCP to increase capital stock

BY LENIE LECTURA – APRIL 6, 2022
from Business Mirror

THE NATIONAL Grid Corp. of the Philippines (NGCP) is increasing its authorized capital stock (ACS) to accommodate the issuance of the non-voting preferred shares to Synergy Grid and Development Philippines, Inc. (SGP).

SGP is subscribing to 203.63 million non-voting preferred shares of NGCP at P6.10 apiece for a total of P12,238,163,000.00. SGP will utilize the proceeds of its follow-on offering (FOO) in November last year to pay NGCP.

The subscription to NGCP shares will result in an increase in the grid operator’s capitalization, as well as give SGP a direct shareholding in NGCP of 9.241 percent of the latter’s outstanding capital stock.

SGP will be entitled to the features of the non-voting preferred shares such as receipt of dividends, apart from the dividends that SGP already indirectly receives from NGCP through holdings companies. In 2020 and 2021, NGCP has declared an annual dividend of P12 billion for its common shares, released on a quarterly basis.

NGCP said the amount will be used to fund its capital expenditure (capex) programs as well as other related expenses.

“This amount will be a huge boost to fund NGCP’s capital expenditure, a huge chunk of which is on new transmission projects for the improvement, upgrading, and expansion of the country’s power grid,” SGP Chairman Henry T. Sy Jr. said.

SGP indirectly controls 60 percent of the outstanding capital stock of NGCP, SGP’s sole operating asset, with an effective equity interest of 40.2 percent consisting of common shares.

NGCP holds the sole and exclusive concession and franchise for the operation of the Philippines’ transmission network, linking power generators and distribution utilities to deliver electricity to power distributors and cooperatives nationwide.

In the next 13 years, NGCP is committed to invest approximately P440 billion across 211 projects which are aimed to support the growing electricity demand in the country and to make the country’s power backbone continuously reliable.

“Our investors who chose to partner with us at SGP are instrumental in ensuring that NGCP’s projects in the pipeline will come into fruition and play a significant part in the country’s economic development,” SGP Vice-Chairman Robert G. Coyiuto Jr. said.