Ayala’s power arm acquiring 51.48% stake in Phinma Energy2 min read

AC Energy Inc., the power arm of conglomerate Ayala Corp. is acquiring a 51.48-percent stake in Phinma Energy Corp. (PHEN) for P3.42 billion.

The deal, which is still subject to regulatory approvals, would help AC Energy achieve its goal to attain 5 gigawatts (GW) of renewables by 2025.

“This transaction is an important step for AC Energy to achieve 5 GW of renewables by 2025. The Phinma Energy platform has significant operating and developmental renewable energy assets, and its large diesel capacity will complement the scaling-up of our renewable projects,” said AC Energy president and Chief Executive Officer Eric Francia.

The sale will allow Phinma to focus on expanding its other businesses, according to company president and Chief Executive Officer Ramon R. del Rosario Jr. “This strategic move allows Phinma to focus on our rapidly expanding investments and operations in the education and construction materials sectors,” said del Rosario.

Under the deal, AC Energy will acquire Phinma Corp. and Philippine Investment Management, Inc.’s combined 51.48-percent stake in PHEN via a secondary share sale. Also, AC Energy will subscribe to 2.632 billion PHEN primary shares at par value.

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

ING acted as exclusive financial advisor for Phinma in this transaction.

AC Energy and PHEN have partnered since 2011 for a 244-megawatt (MW) coal power project in Calaca, Batangas, under South Luzon Thermal Energy Corp.

“Phinma was one of our early partners when Ayala was new to the power sector. This partnership has prospered over the last eight years and we welcome the opportunity to now integrate Phinma Energy into AC Energy’s platform as we grow our presence in the power-generation sector,” said Jaime Augusto Zobel de Ayala, Chairman and CEO of Ayala Corp. in a statement.

Del Rosario also commented that Phinma and Ayala have always enjoyed a strong partnership, “making this agreement a truly welcome culmination of our joint initiatives in the energy sector, as we believe AC Energy is best-positioned to grow the business and take it to the next level.”

Phinma Energy has an attributable generation capacity of 472 MW and is the third-largest retail electricity supplier, serving 378 MW of customer demand.

AC Energy, based on its equity interest in power-generation businesses, owns approximately 1.7 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.