SPNEC to conduct stock rights offering

Solar Philippines Nueva Ecija Corp. (SPNEC) is looking to conduct a stock rights offering to achieve its plan hitting 10 gigawatts of solar projects.

“We need at least P10 billion to complete the development of 10 GW of solar projects. This is only a small percent of project cost, but we believe is a large percent of the value, with development being the bottleneck for the energy transition of the Philippines,” said Solar Philippines founder Leandro Leviste.

On Monday, SPNEC’s board of directors approved the planned SRO, which would give eligible stockholders the opportunity to subscribe to shares, subject to terms to be determined by management, and relevant requirements and regulatory approvals.

The company plans to file the SRO in the second quarter of 2022, with the exact timing depending on the necessary regulatory approvals, SPNEC disclosed yesterday.

Aside from the SRO, the company may also raise capital from private placements with institutional investors to complete the capital required for the company’s expansion plans.

“As a developer, SPNEC’s business model is to make projects shovel-ready, then bring in joint-venture partners who can help fund the construction. That said, we could also invest a much larger amount, and would take the opportunity to raise such if this is seen to be accretive to shareholders,” Leviste said.

SPNEC also approved the acquisition of land as part of its developments, to be funded from proceeds of the SRO and proceeds from its P2.7 billion initial public offering last year.

The company’s developments are located primarily in the provinces of Nueva Ecija, Bulacan, Tarlac, Batangas, and Quezon, where its parent, Solar Philippines, founded by Leviste, spent the past years consolidating land suitable for solar.

These developments would be supported by a potential asset-for-share swap between SPNEC and Solar Philippines, which has a portfolio of over 20 solar project companies, including over 10 GW in development, according to DOE figures.

SPNEC has not yet approved any asset-for-share swap, which is subject to a third-party valuation and fairness opinion by an independent financial advisor.

The compay plans to increase its authorized capital stock to 50 billion shares.