Philippines: MPIC, GT Capital seal series of investment deals worth $940m

Visual from company website.

Philippine conglomerates Metro Pacific Investments Corp (MPIC) and GT Capital Holdings Inc have sealed a series of new deals worth $940 million or P44 billion to deepen their power sector interest.

MPIC disclosed it “formed a strategic alliance” with the GT Capital Group and has made an with initial investment in Global Business Power Corp (GBP), the leading power generator in Visayas and a unit of GT Capital.

It was an exchange of deals for both parties done through their subsidiaries, as GT Capital invested P21.96 billion in share subscriptions to MPIC for a 15.6 per cent ownership, while the latter acquired a 56 per cent stake in GBP for P22.06 billion.

MPIC’s associate, Beacon Electric Asset Holdings Inc, through a wholly owned subsidiary Beacon PowerGen Holdings Inc, has entered into a Share Purchase Agreement with GT Capital to acquire the 56 per cent of the ordinary and issued share capital of GBP.

MPIC, however, noted the placing of its 3.6 billion new ordinary common shares to GT Capital priced at P6.10 per share.

Also Read: Philippines: MPIC forays into logistics, buys assets of four firms for $46.3m

“This will be received by MPIC as a deposit for share subscription while MPIC increases its Authorized Share Capital pursuant to shareholder approvals received in 2015,” the conglomerate said in a statement. “Upon completion of the subscription, GT Capital would hold 11.4 per cent of the enlarged common share capital base of MPIC.”

GT Capital will also acquire an additional 1.3 billion shares from Metro Pacific Holdings Inc (MPHI) – the majority shareholder of MPIC – which would then increase GT Capital’s overall holding in the common share capital of MPIC to 15.6 per cent.

Prior to the issue of new common shares by MPIC, MPHI has subscribed to 4.1 billion newly issued Class A voting preferred shares of MPIC at par value for a total consideration of P41.3 million.

Following all these transactions MPHI continues to hold an overall majority of the share capital of MPIC, with a 55.0 per cent voting interest.

Also Read: MPIC buys Meralco’s 26% stake in tech firm Indra Philippines for $7.1m

MPIC vice president Melody del Rosario informed the local bourse that such consideration will be settled as to P11.03 billion in cash on closing and the balance via a vendor financing facility, which will be replaced with long-term bank debt within 90 days from closing. The cash payment on closing will be funded by a combination of internal resources and bank debt.

GBP is the leading power supplier in Visayas with an aggregate 852 MW of coal and diesel powered generating capacity at present, including 150 MW to commence operations later this year, and 670MW for further expansion. The main development project is a 670 MW super critical coal fired plant in La Union, Pangasinan with 600MW EPPA signed with Manila Electric Co (Meralco)

The investment in GBP will be immediately accretive to the earnings of Beacon Electric.

Also Read: Philippines: GT Capital to up stake in low-cost housing player for $55.9m

“The investment in Global Power is part of MPIC’s drive to accelerate the pace of overall participation in the power generation sector while allowing MERALCO to focus predominantly on development of its ‘One Meralco’ strategy focused on servicing its Luzon customers,” said MPIC chairman Manuel V. Pangilinan.

MPIC president and CEO Jose Ma K. Lim said,  “Although there may be some near-term modest capacity surplus, it is clear that our low per capita power consumption and continuing rapid economic growth combine to mean the outlook for the sector is positive in the medium to long term. To this end, the Global Power investment is a strong generation platform, offering both immediately attractive cash returns and real medium term expansion,” Lim explained.

“We are also in active discussion with PLDT. to increase our economic interest in Beacon Electric, I hope to have a further announcement regarding Beacon Electric imminently,” he added.

As Read:

Philippines: MPHH acquires 20% in Manila Medical Services for $708m

PH tollway firm MPTC completes 45% stake buy in Vietnam’s CII B&R for $86.9m

PH’s Metro Pacific inks 35-year concession deal for expressway project

GT Capital completes acquisition of PH housing firm Pro-Friends

PH co GT Capital raises $222m in block share sale

Profriends Group holds off IPO pricing 

PH real estate firms Federal Land, Alveo sign JV for development of residential project

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.